INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2019

INCOME TAXES

Schedule of pre-tax income from continuing operations on which the provision for income taxes

The pre-tax income from continuing operations on which the provision for income taxes was computed is as follows (in thousands):

	2019		2018
United States	$	11,964	$	10,237
Foreign		(23)		(21)
Total		11,941		10,216

Schedule of income tax expense

Income tax expense consists of the following for the years ended December 31, 2019 and 2018 (in thousands):

	2019		2018
Current tax expense:
Federal	$	1,865	$	1,080
State		372		309
Total tax expense:		2,237		1,389
Deferred tax expense/(benefit):
Federal		120		(462)
State		92		(263)
Total deferred tax expense/(benefit):	$	212	$	(725)
Total	$	2,449	$	664

Schedule of reconciliation of income tax

A reconciliation of income tax computed at the U.S. statutory rate of 21% to the effective income tax rate is as follows:

	2019		2018
Statutory rate	21	%	21	%
State taxes	3		4
Permanent differences and other	—		1
Change in valuation allowance	(1)		(16)
Stock based compensation	(4)		(3)
Other (true – up)	1		—
Effective rate	20	%	7	%

Schedule of tax effects of temporary differences that give rise to deferred tax assets (liabilities)

The tax effects of temporary differences that give rise to deferred tax assets (liabilities) at December 31, 2019 and 2018 are as follows (in thousands):

	2019		2018
Deferred tax assets:
Accrued expenses	$	34	$	37
Lease liability		1,109		217
Accounts receivable		19		18
Inventory		232		117
Stock-based compensation		145		138
Tax Credits and NOL Carryforward		110		354
Other		1		150
Property and equipment		—		—
Amortization		50		57
		1,700		1,088
Less: Valuation allowance		—		(172)
Deferred tax assets	$	1,700	$	916
Deferred tax liabilities:
Property and equipment	$	(192)	$	(176)
Finance lease		(45)		—
Right-of-use asset		(946)		—
Prepaid expenses		(4)		(15)
Deferred tax liabilities	$	(1,187)	$	(191)
Net deferred tax assets	$	513	$	725