Income Taxes (Tables)
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6 Months Ended |
Jun. 30, 2016 |
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| Income Tax Disclosure [Abstract] |
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| Components of deferred tax assets and liabilities |
Components of the Company’s deferred tax assets and liabilities as of June 30, 2016, and December 31, 2015, are as follows:
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Deferred Tax Assets and Liabilities |
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June 30, 2016 |
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December 31, 2015 |
Deferred Tax Assets: |
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Net operating loss carryforwards |
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$ |
1,069,948 |
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$ |
543,116 |
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Net unrealized loss on investment securities |
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534,009 |
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251,539 |
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Loan Loss Provision |
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605,107 |
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1,257,436 |
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Other loss carryforwards |
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2,554,620 |
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1,833,240 |
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Sub-total |
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$ |
4,763,684 |
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$ |
3,885,331 |
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Deferred Tax Liabilities: |
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Basis reduction of investment in partnerships |
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$ |
(2,106,042 |
) |
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$ |
(2,159,058 |
) |
Cost recovery of leased and fixed assets |
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(680,057 |
) |
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(119,297 |
) |
Sub-total |
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$ |
(2,786,099 |
) |
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$ |
(2,278,355 |
) |
Total net deferred tax asset |
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$ |
1,977,585 |
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$ |
1,606,976 |
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| Total income tax expense |
Total income tax expense/(benefit) differs from the amount computed by applying the federal statutory income tax rate of 35 percent for the three and six months ended June 30, 2016 and 2015, to income or loss from operations and other income and expense for the years presented, as follows:
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Income Tax Expense (Benefit) |
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For the Three Months Ended |
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For the Six Months Ended |
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June 30, 2016 |
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June 30, 2015 |
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June 30, 2016 |
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June 30, 2015 |
Application of statutory income tax rate |
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$ |
3,277,737 |
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$ |
1,436,710 |
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$ |
4,025,336 |
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$ |
2,990,144 |
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State income taxes, net of federal tax (benefit) |
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25,234 |
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(8,988 |
) |
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(58,026 |
) |
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28,063 |
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Federal Tax Attributable to Income of Real Estate Investment Trust |
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(2,892,533 |
) |
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(1,476,585 |
) |
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(4,811,998 |
) |
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(2,746,705 |
) |
Total income tax expense (benefit) |
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$ |
410,438 |
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$ |
(48,863 |
) |
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$ |
(844,688 |
) |
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$ |
271,502 |
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| Components of income tax expense |
For the three and six months ended June 30, 2016, all of the income tax benefit presented above relates to the assets and activities held in the Company's TRSs. The components of income tax expense/(benefit) include the following for the periods presented:
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Components of Income Tax Expense (Benefit) |
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For the Three Months Ended |
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For the Six Months Ended |
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June 30, 2016 |
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June 30, 2015 |
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June 30, 2016 |
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June 30, 2015 |
Current tax expense (benefit) |
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Federal |
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$ |
188,467 |
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$ |
94,312 |
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$ |
(438,730 |
) |
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$ |
486,258 |
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State (net of federal tax benefit) |
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15,185 |
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10,167 |
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(35,349 |
) |
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53,977 |
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Total current tax expense (benefit) |
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$ |
203,652 |
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$ |
104,479 |
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$ |
(474,079 |
) |
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$ |
540,235 |
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Deferred tax expense (benefit) |
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Federal |
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$ |
196,737 |
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$ |
(134,187 |
) |
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$ |
(347,932 |
) |
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$ |
(242,819 |
) |
State (net of federal tax benefit) |
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10,049 |
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(19,155 |
) |
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(22,677 |
) |
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(25,914 |
) |
Total deferred tax expense (benefit) |
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$ |
206,786 |
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$ |
(153,342 |
) |
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$ |
(370,609 |
) |
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$ |
(268,733 |
) |
Total income tax expense (benefit), net |
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$ |
410,438 |
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$ |
(48,863 |
) |
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$ |
(844,688 |
) |
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$ |
271,502 |
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| Aggregate cost of securities for federal income tax purposes and securities with unrealized appreciation and depreciation |
The aggregate cost of securities for federal income tax purposes and securities with unrealized appreciation and depreciation, were as follows:
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Aggregate Cost of Securities for Income Tax Purposes (Unaudited) |
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June 30, 2016 |
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December 31, 2015 |
Aggregate cost for federal income tax purposes |
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$ |
4,329,517 |
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$ |
4,750,252 |
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Gross unrealized appreciation |
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4,156,619 |
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5,133,908 |
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Gross unrealized depreciation |
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— |
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(97,500 |
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Net unrealized appreciation |
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$ |
4,156,619 |
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$ |
5,036,408 |
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