INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2016

INCOME TAXES {2}

Income tax provision

The income tax provision consists of:

	2016		2015
Current:
Federal	$	51,000		7,500
Deferred:
Federal		216,000		-
Income Tax Provision	$	267,000	$	7,500

Operating Loss Carry Forwards

The provision for income taxes differ from the amount computed using the federal US statutory income tax rate as follows:

	2016			2015
Provision at U.S. statutory rate	$	1,050,000		$	240,000
Alternative minimum tax		51,000			7,500
Depreciation and amortization		(37,000	)		(29,000	)
Accrued liabilities and sales allowances		38,000			(31,000	)
Non-deductible stock based compensation		23,000			32,000
Other differences		(102,000	)		51,000
Decrease in valuation allowance		(756,000	)		(263,000	)
Income tax provision	$	267,000		$	7,500

Provision for income taxes differ from the amount computed

The tax effects of temporary differences and carry forwards that give rise to significant portions of deferred tax assets and liabilities consist of the following:

	2016			2015
Deferred tax assets:
Net operating loss carryforward	$	121,000		$	1,084,000
Liabilities and reserves		88,000			50,000
Property and equipment and inventory		14,000			17,000
Valuation allowance		-			(756,000	)
		223,000			395,000
Deferred tax liabilities:
Intangible assets		(439,000	)		(395,000	)
		(439,000	)		(395,000	)
Net deferred tax assets and liabilities	$	(216,000	)	$	-