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Note 7 - Income Taxes
 12 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Income Tax Disclosure [Text Block]
7.
INCOME TAXES
 
The Company utilizes the liability method of accounting for income taxes.  The liability method measures the expected income tax impact of future taxable income and deductions implicit in the Consolidated Balance Sheets.  The income tax (benefit) provision in
2020
and
2019
consisted of the following:
 
Year Ended June 30,
  
2020
    
2019
  
Current:
                
Federal
   $
(15,037
 )   $
(13,277
 )
State    
3,501
      
25
  
Deferred    
13,276
      
(13,251
 )
Total income tax provision (benefit)
   $
1,740
     $
(26,503
 )
 
The
2020
and
2019
tax results in an effective rate different than the federal statutory rate because of the following: 
 
Year Ended June 30,
  
2020
    
2019
  
Federal income tax liability (benefit) at statutory rate   $
(97,409
 )   $
85,599
  
State income tax liability, net of federal income tax effect    
2,765
      
20
  
(Decrease) increase in valuation allowance    
61,948
      
(328,541
 )
Current year permanent items    
35,931
      
14,687
  
R&D credit    
(22,568
 )    
(15,000
 )
Return-to-provision    
(30,040
 )    
8,433
  
Expiration of deferred tax assets    
44,790
      
189,186
  
State tax rate change    
18,962
      
-
  
Other    
(12,639
 )    
19,087
  
Total income tax provision (benefit)
   $
1,740
     $
(26,529
 )
 
Temporary differences which give rise to deferred income tax assets and liabilities at 
June 30,
2020
and
June 
30,
2019
include: 
 
   
2020
    
2019
  
Deferred income tax assets:
                
Deferred compensation   $
614,018
     $
642,424
  
Stock-based compensation    
249,313
      
228,981
  
Accrued expenses and reserves    
479,112
      
503,726
  
Deferred revenue    
146,841
      
202,102
  
Federal and state net operating loss carryforwards    
606,730
      
558,117
  
Credit carryforwards    
216,484
      
139,504
  
Equipment and leasehold improvements    
134,045
      
122,714
  
Valuation allowance    
(2,444,035
 )    
(2,382,087
 )
Total deferred income tax assets
    
2,508
      
15,481
  
                 
Deferred income tax liabilities:
                
Other    
(2,508
 )    
(2,205
 )
Net deferred income tax assets
   $
-
     $
13,276
  
 
 
Deferred income tax balances reflect the effects of temporary differences between the tax bases of assets and liabilities and their carrying amounts.  These differences are stated at enacted tax rates expected to be in effect when taxes are actually paid or recovered.  The recognition of these deferred tax balances will be realized through normal recurring operations and, as such, the Company has recorded the value of such expected benefits. The Company has federal net operating loss carryforwar
ds of
 
$352,281
 which expire in fiscal year
2037
 and 
$545,245
which can be carried forward indefinitely. The Company has state net operating loss carryforwards totaling approximately $
6,358,000
 in Wisconsin, which expire in fiscal year
s 
2025
through
2039
, and 
$342,286
 in other states.
 
 Generally accepted accounting principles
prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken, or expected to be taken, in a tax return.  There were
no
additional significant matters determined to be unrecognized tax benefits taken or expected to be taken in a tax return that have been recorded on the Company's Consolidated Financial Statements for the
years 
ended
June 30,
2020
 and 
2019
.
 
Additionally,
GAAP
 
provides guidance on the recognition of interest and penalties related to income taxes.  
No
interest or penalties related to income taxes has been accrued or recognized as of and for the years ended 
June 30,
2020
 or 
2019
. The Company records interest related to unrecognized tax benefits in interest expense.
 
The Company does
not
believe it has any unrecognized tax benefits as of 
June 30,
2020
 or
 
2019
. Any changes to the Company's unrecognized tax benefits during the fiscal years ended 
June 30,
2020
and 
2019
would have impacted the effective tax rate.
 
The Company files income tax returns in the United States federal jurisdiction and in several state jurisdictions.  The Company's federal tax returns for tax years and state income tax returns are open for the standard regulatory period.
 
The following are the changes in the valuation allowance
:
 
 
   
Balance,
    
Decrease (Increase)
      
 
 
   
beginning
    
in valuation
    
Balance,
  
Year Ended June 30,
  
of year
    
allowance
    
end of year
  
2020   $
(2,382,087
 )   $
(61,948
 )   $
(2,444,035
 )
2019
   $
(2,710,628
 )   $
328,541
     $
(2,382,087
 )