Income Tax Provision

9 Months Ended

Sep. 30, 2012

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

4. Income Tax Provision

The Company recognized an income tax provision of $272,700 for the nine months ended September 30, 2012 and a net income tax provision of $11,800 for the same period in 2011.

Income tax provision for the nine months ended September 30, 2012 was calculated as follows:

	Federal		State		Total
Current tax provision	$	85,300	$	14,500	$	99,800
Deferred tax provision		134,550		38,350		172,900
	$	219,850	$	52,850	$	272,700

Income tax provision (benefit) for the nine months September 30, 2011 was calculated as follows:

	Federal			State			Total
Current tax provision	$	140,000		$	23,300		$	163,300
Deferred tax (benefit)		(117,800	)		(33,700	)		(151,500	)
	$	22,200		$	(10,400	)	$	11,800

Income tax provision for the three months ended September 30, 2012 was calculated as follows:

	Federal		State		Total
Current tax provision	$	14,300	$	2,500	$	16,800
Deferred tax provision		56,050		15,950		72,000
	$	70,350	$	18,450	$	88,800

Income tax provision (benefit) for the three months ended September 30, 2011 was calculated as follows:

	Federal			State			Total
Current tax provision	$	45,200		$	7,500		$	52,700
Deferred tax (benefit)		(161,600	)		(46,000	)		(207,600	)
	$	(116,400	)	$	(38,500	)	$	(154,900	)

Deferred income taxes are recognized using the asset and liability method by applying income tax rates to cumulative temporary differences based on when and how they are expected to affect the tax returns. Deferred tax assets and liabilities are adjusted for income tax rate changes. Deferred income tax assets have been offset by a valuation allowance of $1,719,000 as of September 30, 2012. Management reviews deferred income taxes regularly throughout the year, and accordingly makes any necessary adjustments to properly reflect the valuation allowance based upon current financial trends and projected results.