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Income Taxes (Tables)
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3 Months Ended |
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Mar. 31, 2013
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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 March 31, 2013,
November 30, 2012 and December 31, 2012 are as follows:
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Deferred Tax Assets and Liabilities |
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March 31, 2013 |
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November 30, 2012 |
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December 31, 2012 |
Deferred Tax Assets: |
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Organization costs |
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$ |
— |
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$ |
(17,668 |
) |
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$ |
(27,188 |
) |
Net operating loss carryforwards |
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— |
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(6,411,230 |
) |
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— |
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Net unrealized loss on investment securities |
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— |
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— |
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(143,822 |
) |
Cost recovery of leased assets |
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— |
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(36,443 |
) |
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— |
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Asset acquisition costs |
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— |
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(134,415 |
) |
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(158,535 |
) |
AMT and State of Kansas credit |
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— |
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(196,197 |
) |
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— |
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Sub-total |
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$ |
— |
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$ |
(6,795,953 |
) |
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$ |
(329,545 |
) |
Deferred Tax Liabilities: |
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Basis reduction of investment in partnerships |
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$ |
2,090,696 |
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$ |
11,655,817 |
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$ |
2,675,142 |
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Net unrealized gain on investment securities |
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1,040,400 |
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2,312,269 |
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— |
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Cost recovery of leased assets |
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— |
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— |
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50,446 |
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Sub-total |
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3,131,096 |
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13,968,086 |
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2,725,588 |
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Total net deferred tax liability |
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$ |
3,131,096 |
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$ |
7,172,133 |
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$ |
2,396,043 |
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| Total income tax expense |
Total income tax expense differs from the amount computed by applying the federal statutory income tax rates of 35 percent for the three-month periods ended March 31, 2013, February 29, 2012 and for the one-month transition period ended December 31, 2012 to income (loss) from operations and other income (expense) for the years presented, as follows:
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Income Tax Expense (Benefit) |
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For the Three-Month Periods Ended |
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For the One-Month
Transition Period Ended
December 31, 2012
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March 31, 2013 |
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February 29, 2012 |
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Application of statutory income tax rate |
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$ |
1,201,795 |
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$ |
3,224,535 |
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$ |
(848,239 |
) |
State income taxes, net of federal tax benefit |
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62,270 |
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241,379 |
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(64,771 |
) |
Dividends received deduction |
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— |
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— |
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(7,133 |
) |
Income of Real Estate Investment Trust |
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(243,121 |
) |
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— |
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— |
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Total income tax expense (benefit) |
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$ |
1,020,944 |
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$ |
3,465,914 |
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$ |
(920,143 |
) |
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| Components of income tax expense |
The components of income tax expense include the following for the periods presented:
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Components of Income Tax Expense (Benefit) |
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For the Three-Month Periods Ended |
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For the One-Month
Transition Period Ended December 31, 2012
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March 31, 2013 |
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February 29, 2012 |
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Current tax expense |
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Federal |
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$ |
268,205 |
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$ |
— |
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$ |
3,610,165 |
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State (net of federal tax benefit) |
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17,686 |
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— |
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245,782 |
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AMT expense |
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— |
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10,000 |
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— |
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Total current tax expense |
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285,891 |
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10,000 |
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3,855,947 |
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Deferred tax expense (benefit) |
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Federal |
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690,468 |
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3,215,230 |
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(4,465,104 |
) |
State (net of federal tax benefit) |
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44,585 |
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240,684 |
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(310,986 |
) |
Total deferred tax expense (benefit) |
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735,053 |
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3,455,914 |
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(4,776,090 |
) |
Total income tax expense (benefit) |
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$ |
1,020,944 |
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$ |
3,465,914 |
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$ |
(920,143 |
) |
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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 |
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March 31, 2013 |
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November 30, 2012 |
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December 31, 2012 |
Aggregate cost for federal income tax purposes |
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$ |
19,734,837 |
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$ |
41,995,195 |
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$ |
22,007,069 |
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Gross unrealized appreciation |
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2,161,017 |
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33,892,176 |
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2,018,455 |
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Gross unrealized depreciation |
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— |
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(801,340 |
) |
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— |
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Net unrealized appreciation |
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$ |
2,161,017 |
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$ |
33,090,836 |
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$ |
2,018,455 |
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