INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

INCOME TAXES [Abstract]

Provision for Income Taxes

The provision for income taxes consists of the following:

(in thousands)	Year Ended December 31,
Income Tax Benefit	2020			2019
Current provision (benefit):
Federal	$	(1,385	)	$	(582	)
State		65			7
Foreign		6			(10	)
Related to UTP		20			26
		(1,294	)		(559	)
Deferred provision (benefit):
Federal		(62	)		(94	)
State		(3	)		(24	)
Foreign		(19	)		(13	)
		(84	)		(131	)
Total tax benefit	$	(1,378	)	$	(690	)

Income (Loss) Before Income Taxes

Income (loss) before income taxes was earned in the following tax jurisdictions:

(in thousands)	Year Ended December 31,
Income (Loss) Before Income Taxes	2020			2019
United States	$	(6,222	)	$	(1,959	)
Spain		161			21
Canada		(204	)		(131	)
Australia		(7	)		(170	)
United Kingdom		(7	)		(354	)
TOTAL	$	(6,279	)	$	(2,593	)

Income Tax Effects of Temporary Differences Impacting Deferred Income Tax Assets and Liabilities

The income tax effects of temporary differences that give rise to significant portions of deferred income tax assets and liabilities are as follows:

Deferred income tax assets:	2020			2019
(in thousands)
Inventory	$	498		$	468
Stock-based compensation		63			51
Accounts receivable		4			5
Sales returns		105			119
Foreign currency translation gain/loss in OCI		323			359
Goodwill and other intangible assets amortization		5			33
Net operating loss		665			459
Accrued expenses		170			-
Leases		250			145
Other		1			-
Total deferred income tax assets		2,084			1,639
Less:  valuation allowance		(1,320	)		(382	)
Total deferred income tax assets, net of valuation allowance	$	764		$	1,257
Property and equipment depreciation	$	682		$	740
Accrued expenses		-			90
Total deferred income tax liabilities		682			830
Net deferred tax asset (liability)	$	82		$	427

Reconciliation of Effective Tax Rate from Statutory Rate

Below is a reconciliation of our effective tax rate from the statutory rate:

	Year Ended December 31,
	2020			2019
Statutory rate – Federal U.S. income tax		21	%		21	%
State and local taxes		3	%		0	%
Permanent book/tax differences		(2	)%		(6	)%
Difference in tax rates in loss carryback periods		8	%		3	%
Change in valuation allowance		(10	)%		(5	)%
Rate differential on UTP reversals		0	%		13	%
Other, net		2	%		1	%
Effective rate		22	%		27	%

Reconciliation of Uncertain Tax Positions

A reconciliation of the beginning and ending amount of uncertain tax positions (“UTP”) is as follows:

Fiscal Year	2020		2019
UTP at beginning of the year	$	296	$	1,416
Gross increase (decrease) to tax positions in current period		77		(1,146	)
Interest expense		20		26
Lapses in statute		-		-
UTP at end of year	$	393	$	296