INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2017

The income tax provision (benefit), in thousands, consists of the following for the years ended December 31, 2017 and 2016:

A reconciliation of income taxes at the statutory rate to the reported provision (benefit), in thousands, is as follows:


	2017			2016
Federal income tax at statutory rate	$	(380	)	$	(1,071	)
State and local income taxes, net of federal income tax effect	(52		)	(48		)
Permanent differences	2			902
Tax reform legislation	1,736			—
(Decrease) Increase in deferred tax asset valuation allowance	(1,258		)	408
Other differences	(36		)	(111		)
	$	12		$	80

Significant components of the Company’s deferred tax liabilities and assets, in thousands, as of December 31, 2017 and 2016 are as follows:


	2017			2016
Deferred tax liabilities
Property and equipment	$	(300	)	$	(935	)
Gross deferred tax liabilities	(300		)	(935		)
Deferred tax assets
Intangibles and goodwill	1,178			2,038
Accrued property taxes	6			53
Allowance for doubtful accounts	16			14
Inventory capitalization	72			110
Stock options	424			605
Federal net operating loss carry forward	3,901			4,706
State net operating loss carry forward	1,787			1,658
State recycling equipment tax credit carry forward	4,590			4,593
Inventory valuation reserve	—			60
Accrued expenses	160			187
Other	8			11
Gross deferred tax assets	12,142			14,035
Valuation allowance	(11,815		)	(13,073		)
Net deferred tax assets	$	27		$	27

The recorded valuation allowance, in thousands, consisted of the following at December 31, 2017 and 2016:


	Year Ended December 31,
	2017			2016
Valuation allowance, beginning of year	$	13,073		$	12,665
(Decrease) Increase in deferred tax asset valuation allowance	(1,258		)	408
Valuation allowance, end of year	$	11,815		$	13,073