Annual report pursuant to Section 13 and 15(d)

Income Taxes

v3.6.0.2
Income Taxes
12 Months Ended
Dec. 31, 2016
Income Taxes  
Income Taxes

4.  Income Taxes

 

Deferred tax attributes resulting from differences between the tax basis of assets and liabilities and it reported amount in the consolidated balance sheet at December 31, 2016 and 2015 are as follows: 

 

 

 

 

 

 

 

 

 

 

    

2016

    

2015

 

Non-current assets

 

 

 

 

 

 

 

Accruals and reserves

 

$

546

 

$

529

 

Deferred rent credit

 

 

283

 

 

 —

 

Depreciation and amortization

 

 

(413)

 

 

(8)

 

Total deferred tax assets

 

$

416

 

$

521

 

 

The provision (benefit) for income taxes is as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31,

 

 

    

2016

    

2015

    

2014

 

Current:

 

 

 

 

 

 

 

 

 

 

Federal

 

$

2,515

 

$

2,779

 

$

2,693

 

State

 

 

55

 

 

61

 

 

79

 

Foreign

 

 

357

 

 

231

 

 

219

 

 

 

 

2,927

 

 

3,071

 

 

2,991

 

Deferred:

 

 

 

 

 

 

 

 

 

 

Federal

 

 

102

 

 

(40)

 

 

6

 

State

 

 

3

 

 

(3)

 

 

1

 

 

 

 

105

 

 

(43)

 

 

7

 

 

 

$

3,032

 

$

3,028

 

$

2,998

 

Effective Tax Rate

 

 

33.9

%  

 

34.2

%  

 

34.2

%

 

The reasons for the difference between total tax expense and the amount computed by applying the U.S. statutory federal income tax rate to income before income taxes are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31,

 

 

    

2016

    

2015

    

2014

 

Statutory rate applied to pretax income

 

$

3,037

 

$

3,012

 

$

2,978

 

State income taxes, net of federal income tax benefit

 

 

36

 

 

39

 

 

52

 

Foreign income taxes under U.S. statutory rate

 

 

(64)

 

 

(44)

 

 

(56)

 

Other items, including the impact of the change in NJ state tax rate

 

 

23

 

 

21

 

 

24

 

Income tax expense

 

$

3,032

 

$

3,028

 

$

2,998

 

 

The Company receives a tax deduction from the income realized by employees on the exercise of certain non-qualified stock options and restricted stock awards for which the tax effect of the difference between the book and tax deduction is recognized as a component of stockholders’ equity.

 

The Company has analyzed filing positions in all of the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years in these jurisdictions. The Company has identified its federal consolidated tax return and its state tax return in New Jersey and its Canadian tax return as major tax jurisdictions. As of December 31, 2016, the Company’s 2013 through 2015 Federal tax returns remain open for examination, as the Company recently concluded an Internal Revenue Service examination for the 2011 and 2012 tax years. This examination resulted in no change to the previously filed Federal corporate tax returns.  The Company’s New Jersey and Canadian tax returns are open for examination for the years 2013 through 2015. The Company’s policy is to recognize interest related to unrecognized tax benefits as interest expense and penalties as operating expenses. The Company believes that it has appropriate support for the income tax positions it takes and expects to take on its tax returns, and that its accruals for tax liabilities are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter.

 

For financial reporting purposes, income before income taxes includes the following components:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31,

 

 

    

2016

    

2015

    

2014

 

United States

 

$

7,514

 

$

7,937

 

$

7,903

 

Foreign

 

 

1,419

 

 

921

 

 

855

 

 

 

$

8,933

 

$

8,858

 

$

8,758