9. INCOME TAXES

No federal income taxes were paid during the years ended January 31, 2018 and 2017 due to the Company’s net losses. The provision of income taxes consist of state minimum income taxes.

As of January 31, 2018, the Company had available federal net operating loss (“NOL”) carry-forwards of approximately $53.5 million which will begin to expire in 2030 and California state NOL carry-forwards of approximately $44.2 million which will begin to expire in 2033. As of January 31, 2018 and 2017, the net deferred tax assets of approximately $16.3 million and $17.3 million, respectively, generated primarily by NOL carry-forwards, have been fully reserved due to the uncertainty surrounding the realization of such benefits. The net valuation allowance increased by approximately $1.0 million and $8.5 million during the years ended January 31, 2018 and 2017, respectively.

Current tax laws impose substantial restrictions on the utilization of net operating loss and credit carry-forwards in the event of an “ownership change,” as defined by the Internal Revenue Code. If there should be an ownership change, the Company’s ability to utilize its carry-forwards could be limited. The Company has not conducted a formal net operating loss carryforward analysis.

Significant components of the Company’s deferred tax assets were as follows (in thousands):


	January 31,
Deferred tax assets:	2018		2017
Net operating loss carryforwards	$	14,314	$	15,618
Stock-based compensation expense		831		908
Tax credit carryforwards		735		576
Other		377		194
Total deferred tax assets		16,257		17,296
Less: valuation allowance		(16,257)		(17,296)
Net deferred tax assets	$	—	$	—

A reconciliation of income taxes provided at the federal statutory rate (21%) to the actual income tax provision was as follows (in thousands):


	Year ended
	January 31,
	2018		2017
Income tax benefit computed at U.S. statutory rate	$	(5,477)	$	(6,258)
State income tax (net of federal benefit)		(1,150)		(1,196)
Change in federal rate from 34% to 21%		7,662		⸺
Change in valuation allowance		(1,039)		7,342
Research and development credits		(129)		(125)
Other		135		239
Provision for income taxes	$	2	$	2

As a result of passage of the Tax Cut and Jobs Act (the “Act”) on December 22, 2017, the Company’s U.S. deferred tax assets, liabilities, and associated valuation allowance as of January 31, 2018 have been re-measured at the new U.S. federal tax rate of 21%. As of January 31, 2018 and 2017, the Company did not have any material unrecognized tax benefits. The tax years from 2010 to 2018 remain open for examination by the federal and state authorities.