Note 4 - Income Taxes |
3 Months Ended |
|---|---|
May 03, 2025 | |
| Notes to Financial Statements | |
| Income Tax Disclosure [Text Block] |
Note 4 – Income Taxes
For the 13-week periods ended May 3, 2025 and May 4, 2024, the Company recorded an income tax expense of approximately $44,000, or (0.4)% of the loss before income taxes compared to an expense of approximately $311,000, or (3.7)% of the loss before income taxes, respectively. The change in income taxes for the 13-week period ended May 3, 2025, compared to the prior year periods, was primarily due to changes in valuation allowance adjustments and state income taxes.
The Company recognizes deferred tax assets and liabilities using estimated future tax rates for the effect of temporary differences between the book and tax basis of recorded assets and liabilities, including net operating loss carry forwards. Management assesses the realizability of deferred tax assets and records a valuation allowance if it is more likely than not that all or a portion of the deferred tax assets will not be realized. The Company considers the probability of future taxable income and our historical profitability, among other factors, in assessing the amount of the valuation allowance. Adjustments could be required in the future if the Company estimates that the amount of deferred tax assets to be realized is more than the net amount recorded. Any change in the valuation allowance could have the effect of increasing or decreasing the income tax provision in the condensed consolidated statement of operations based on the nature of the deferred tax asset deemed realizable in the period in which such determination is made. As of May 3, 2025 and May 4, 2024, the Company recorded a full valuation allowance against deferred tax assets. |