INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2017

Schedule of Taxable Income Reconciliation

The following table reconciles the Company’s TRS GAAP net income (loss) to taxable income (in thousands):



	Year Ended December 31,
	2017		2016		2015
	(in thousands)		(in thousands)		(in thousands)
GAAP consolidated net income (loss) attributable to Five Oaks Investment Corp	4,707		(7,990	)	450
GAAP net loss (income) from REIT operations	(4,645	)	6,654		(1,826	)
GAAP net income (loss) of taxable subsidiary	62		(1,336	)	(1,376	)
Capitalized transaction fees	(41	)	(41	)	(41	)
Unrealized gain (loss)	639		1,964		2,041
Deferred income	19		204		—
Tax income (loss) of taxable subsidiary before utilization of net operating losses	679		791		624
Utilizations of net operating losses	(679	)	(791	)	(624	)
Net tax income of taxable subsidiaries	—		—		—

Schedule of Effective Income Tax Rate Reconciliation

The following is a reconciliation of the statutory federal and state tax rates to the effective rates, for the years ended December 31, 2017, 2016 and 2015:



	Year Ended December 31,
	2017		2016		2015
	(in thousands)		(in thousands)		(in thousands)
U.S. Federal Statutory Income Tax	1,601		(2,717	)	153
State Taxes	1		(53	)	(54	)
REIT Income not subject to federal income tax	(1,579	)	2,263		(621	)
Tax affect of U.S. corporate rate change	364		—		—
Valuation Allowance	(406	)	507		522
Total income tax provision (benefit)	(19	)	—		—
Effective income tax rate	0.41	%	—	%	—	%

Schedule of Deferred Tax Assets

The TRS has a deferred tax asset (liability), comprised of the following (in thousands):



	As of December 31, 2017		As of December 31, 2016
Accumulated net operating losses of TRS	337		758
Unrealized gain (loss)	251		127
Capitalized transaction costs	122		196
Deferred income	57		77
AMT Credit	19		12
Deferred tax asset	786		1,170
Valuation allowance	(767	)	(1,170	)
Net non-current deferred tax asset (liability)	19		—