Note 7 - Income Taxes

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

NOTE 7 – INCOME TAXES

Deferred taxes are recorded based upon differences between the financial statement and tax bases of assets and liabilities and available carryforwards. Temporary differences and carryforwards which gave rise to a significant portion of deferred tax assets and liabilities as of December 31, 2013 and 2012 are as follows (dollars in thousands):

	December 31,
	2013			2012
Deferred tax assets:
Net operating losses	$	56,294		$	50,502
Fixed asset basis difference		6,559			7,141
Contributions carryover		2			2
Deferred compensation		2,354			2,367
Accrued liabilities		63			29
Total deferred tax assets		65,272			60,041
Valuation allowance for deferred tax assets		(65,272	)		(60,041	)
Net deferred tax asset	$	-		$	-

The valuation allowance increased $5,231,000 and $5,253,000 in 2013 and 2012, respectively. The change in deferred tax assets resulted from current year net operating losses, expiration of prior year loss carryovers, and changes to future tax deductions resulting from terms of stock compensation plans.

As of December 31, 2013, the Company had net operating loss (“NOL”) carryforwards of approximately $204.5 million for federal income tax purposes and $111.2 million for California income tax purposes. Such carryforwards expire in varying amounts through the year 2033. Use of the carryforward amounts is subject to an annual limitation as a result of ownership changes.

As of December 31, 2013, the Company possessed unrecognized tax benefits totaling approximately $2.8 million. None of these, if recognized, would affect the Company's effective tax rate because the Company has recorded a full valuation allowance against these assets.

As of December 31, 2011, the Company had accrued a total of $321,000 for state taxes, interest and penalties related to income tax positions in prior returns. As a result of the expiration of statutes of limitation during the year ended December 31, 2012, the Company recognized a state tax benefit of $321,000.

The Company's tax years 2010 through 2013 remain subject to examination by the Internal Revenue Service, and tax years 2009 through 2013 remain subject to examination by California tax jurisdictions. In addition, the Company's loss carryforward amounts are generally subject to examination and adjustment for a period of three years for federal tax purposes and four years for California purposes, beginning when such carryovers are utilized to reduce taxes in a future tax year.

A reconciliation of the income tax benefit to the statutory federal income tax rate is as follows (dollars in thousands):

	Year Ended December 31,
	2013			2012			2011
Expected federal income tax benefit at 34%	$	(7,698	)	$	(6,614	)	$	(5,720	)
Loss with no tax benefit provided		7,108			5,535			4,880
State income tax		6			10			7
State tax benefit		-			(321	)		-
Stock Options		-			-			(6	)
Non-deductible expenses and other		590			1,079			846
Income tax (benefit) expense	$	6		$	(311	)	$	7

Because it is more likely than not that the Company will not realize its deferred tax assets, it has recorded a full valuation allowance against these assets. Accordingly, no deferred tax asset has been recorded in the accompanying balance sheet.