8. INCOME TAXES

The provision for income taxes consists of the following:

	Year ended December 31,
	2014		2013			2012
Current taxes:
Federal	$	1,939,831	$	2,724,597		$	686,968
State		17,872		25,491			12,182
Total current taxes		1,957,703		2,750,088			699,150
Deferred taxes:
Federal		425,126		(68,296	)		1,134,532
State		3,878		3,024			340,372
Total deferred taxes		429,004		(65,272	)		1,474,904
Total provision for income taxes	$	2,386,707	$	2,684,816		$	2,174,054

The effective income tax rate of the Company differs from the federal statutory tax rate of 34% due to the following items:

	Year ended December 31,
	2014			2013			2012
Statutory rate		34.00	%		34.00	%		34.00	%
State income taxes, net of federal income tax benefit		0.17	%		0.21	%		0.16	%
Stock-based compensation		(0.40	)%		0.11	%		1.51	%
Miscellaneous other, net		0.17	%		(0.64	)%		6.51	%
Effective tax rate		33.94	%		33.68	%		42.18	%

The effective rate reconciliation includes the permanent differences and changes in valuation allowance for windfalls and stock-based compensation, and net operating loss.

Deferred income taxes reflect the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The components of deferred income tax assets and liabilities are as follows:

	Year ended December 31,
	2014		2013		2012

Deferred revenues	$	50,722	$	71,062	$	132,514
Other		96,501		71,305		27,322
Options		931,548		1,365,409		1,413,214
Net deferred tax asset	$	1,078,771	$	1,507,776	$	1,573,050

Stock-based compensation, recorded in the Company's consolidated financial statements is non-deductible for tax purposes and increases the Company's effective tax rate. Deferred tax assets, including those associated with stock based compensation, are reviewed and adjusted for apportionment and potential tax rates changes in various jurisdictions.

During 2014, the Company has recorded $1.9 million of excess tax benefits resulting from the exercise of stock options which was recorded in additional paid in capital. As of December 31, 2014, the Company has a federal net operating loss carryforward of $2.9 million attributable to excess deduction from the exercise of stock options, the tax benefit of which will be recorded in additional paid in capital when utilized.

As of December 31, 2014, the Company believes that there are no significant uncertain tax positions, and no amounts have been recorded for interest and penalties. The tax periods open to examination by the major taxing jurisdictions to which the Company is subject include fiscal years 2011 through 2013.