BLTI » Topics » NOTE 7 - INCOME TAXES

These excerpts taken from the BLTI 10-K filed Mar 16, 2009.
Income Taxes
 
Differences between accounting for financial statement purposes and accounting for tax return purposes are stated as deferred tax assets or deferred tax liabilities in the accompanying consolidated financial statements. The provision for income taxes represents the tax payable for the period and the change during the period in deferred tax assets and liabilities. We establish a valuation allowance when it is more likely than not that the deferred tax assets are not realizable.
 
In July 2006, the FASB issued FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, An Interpretation of FASB Statement No. 109 (“FIN 48”), which clarifies the accounting for uncertainty in income taxes recognized in the financial statements in accordance with FAS 109, Accounting for Income Taxes. FIN 48 provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. Income tax positions must meet a more-likely-than-not recognition threshold at the effective date to be recognized upon the adoption of FIN 48 and in subsequent periods. This interpretation also provides guidance on measurement, derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. We adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, we recognized a $156,000 increase in the liability for unrecognized tax benefits, which was accounted for as an increase to our January 1, 2007 accumulated deficit balance.


F-12


Table of Contents

 
BIOLASE TECHNOLOGY, INC.
 
NOTES TO CONSOLIDATED FINANCIAL STATEMENT — (Continued)
 
We recognize interest and penalties related to unrecognized tax benefits within the income tax provision line in the accompanying consolidated statement of operations. Accrued interest and penalties are included within the related tax liability line in our consolidated balance sheet.
 
Income
Taxes



 



Differences between accounting for financial statement purposes
and accounting for tax return purposes are stated as deferred
tax assets or deferred tax liabilities in the accompanying
consolidated financial statements. The provision for income
taxes represents the tax payable for the period and the change
during the period in deferred tax assets and liabilities. We
establish a valuation allowance when it is more likely than not
that the deferred tax assets are not realizable.


 



In July 2006, the FASB issued FASB Interpretation No. 48,
Accounting for Uncertainty in Income Taxes, An Interpretation
of FASB Statement No. 109
(“FIN 48”),
which clarifies the accounting for uncertainty in income taxes
recognized in the financial statements in accordance with
FAS 109, Accounting for Income Taxes. FIN 48
provides that a tax benefit from an uncertain tax position may
be recognized when it is more likely than not that the position
will be sustained upon examination, including resolutions of any
related appeals or litigation processes, based on the technical
merits. Income tax positions must meet a more-likely-than-not
recognition threshold at the effective date to be recognized
upon the adoption of FIN 48 and in subsequent periods. This
interpretation also provides guidance on measurement,
derecognition, classification, interest and penalties,
accounting in interim periods, disclosure and transition. We
adopted the provisions of FIN 48 on January 1, 2007.
As a result of the implementation of FIN 48, we recognized
a $156,000 increase in the liability for unrecognized tax
benefits, which was accounted for as an increase to our
January 1, 2007 accumulated deficit balance.





F-12





Table of Contents





 




BIOLASE
TECHNOLOGY, INC.




 




NOTES TO
CONSOLIDATED FINANCIAL
STATEMENT — (Continued)


 



We recognize interest and penalties related to unrecognized tax
benefits within the income tax provision line in the
accompanying consolidated statement of operations. Accrued
interest and penalties are included within the related tax
liability line in our consolidated balance sheet.


 




These excerpts taken from the BLTI 10-K filed Mar 17, 2008.
Income Taxes
 
Differences between accounting for financial statement purposes and accounting for tax return purposes are stated as deferred tax assets or deferred tax liabilities in the accompanying consolidated financial statements. The provision for income taxes represents the tax payable for the period and the change during the period in deferred tax assets and liabilities. We establish a valuation allowance when it is more likely than not that the deferred tax assets are not realizable.
 
In July 2006, the FASB issued FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, An Interpretation of FASB Statement No. 109 (“FIN 48”), which clarifies the accounting for uncertainty in income taxes recognized in the financial statements in accordance with FAS 109, Accounting for Income Taxes. FIN 48 provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits. Income tax positions must meet a more-likely-than-not recognition threshold at the effective date to be recognized upon the adoption of FIN 48 and in subsequent periods. This interpretation also provides guidance on measurement, derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. We adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, we recognized a $156,000 increase in the liability for unrecognized tax benefits, which was accounted for as an increase to our January 1, 2007 accumulated deficit balance.
 
We recognize interest and penalties related to unrecognized tax benefits within the income tax provision line in the accompanying consolidated statement of operations. Accrued interest and penalties are included within the related tax liability line in our consolidated balance sheet.
 
Income
Taxes



 



Differences between accounting for financial statement purposes
and accounting for tax return purposes are stated as deferred
tax assets or deferred tax liabilities in the accompanying
consolidated financial statements. The provision for income
taxes represents the tax payable for the period and the change
during the period in deferred tax assets and liabilities. We
establish a valuation allowance when it is more likely than not
that the deferred tax assets are not realizable.


 



In July 2006, the FASB issued FASB Interpretation No. 48,
Accounting for Uncertainty in Income Taxes, An Interpretation
of FASB Statement No. 109
(“FIN 48”),
which clarifies the accounting for uncertainty in income taxes
recognized in the financial statements in accordance with
FAS 109, Accounting for Income Taxes. FIN 48
provides that a tax benefit from an uncertain tax position may
be recognized when it is more likely than not that the position
will be sustained upon examination, including resolutions of any
related appeals or litigation processes, based on the technical
merits. Income tax positions must meet a more-likely-than-not
recognition threshold at the effective date to be recognized
upon the adoption of FIN 48 and in subsequent periods. This
interpretation also provides guidance on measurement,
derecognition, classification, interest and penalties,
accounting in interim periods, disclosure and transition. We
adopted the provisions of FIN 48 on January 1, 2007.
As a result of the implementation of FIN 48, we recognized
a $156,000 increase in the liability for unrecognized tax
benefits, which was accounted for as an increase to our
January 1, 2007 accumulated deficit balance.


 



We recognize interest and penalties related to unrecognized tax
benefits within the income tax provision line in the
accompanying consolidated statement of operations. Accrued
interest and penalties are included within the related tax
liability line in our consolidated balance sheet.


 




This excerpt taken from the BLTI 10-K filed Mar 16, 2007.

Income Taxes

Differences between accounting for financial statement purposes and accounting for tax return purposes are stated as deferred tax assets or deferred tax liabilities in the accompanying consolidated financial statements. The provision for income taxes represents the tax payable for the period and the change during the period in deferred tax assets and liabilities. We establish a valuation allowance when it is more likely than not that the deferred tax assets are not realizable.

This excerpt taken from the BLTI 10-K filed Mar 16, 2006.

Income Taxes

 

Differences between accounting for financial statement purposes and accounting for tax return purposes are stated as deferred tax assets or deferred tax liabilities in the accompanying consolidated financial statements. The provision for income taxes represents the tax payable for the period and the change during the period in deferred tax assets and liabilities. We establish a valuation allowance when it is more likely than not that the deferred tax assets are not realizable.

 

This excerpt taken from the BLTI 10-Q filed Nov 9, 2005.

NOTE 7 – INCOME TAXES

 

Based upon our operating losses during 2004 and the available evidence, management determined that it is more likely than not that the deferred tax assets as of December 31, 2004 would not be realized. Consequently, we recorded a valuation allowance for our net deferred tax asset in the amount of $21,100,000 as of December 31, 2004. In this determination, we considered factors such as our earnings history, future projected earnings and tax planning strategies. If sufficient evidence of our ability to generate sufficient future taxable income becomes apparent, we may reduce our valuation allowance, resulting in income tax benefits in our statement of operations and in additional paid-in-capital. Management continues to evaluate the potential realization of our deferred tax assets and assesses the need for reducing the valuation allowance periodically. As of September 30, 2005 we determined that a valuation allowance is still required. As a result of the valuation allowance, we recognized a modest tax provision that primarily related to our foreign operations and certain U.S. deferred tax liabilities that could not be offset against our deferred tax assets. We will continue to evaluate the potential realization of our deferred tax assets during the remainder of 2005 to determine whether the valuation allowance should be reduced.

 

This excerpt taken from the BLTI 10-Q filed Sep 30, 2005.

NOTE 7 – INCOME TAXES

 

Based upon our operating losses during 2004 and the available evidence, management determined that it is more likely than not that the deferred tax assets as of December 31, 2004 would not be realized. Consequently, we recorded a valuation allowance for our net deferred tax asset in the amount of $21,100,000 as of December 31, 2004. In this determination, we considered factors such as our earnings history, future projected earnings and tax planning strategies. If sufficient evidence of our ability to generate sufficient future taxable income becomes apparent, we may reduce our valuation allowance, resulting in income tax benefits in our statement of operations and in additional paid-in-capital. Management continues to evaluate the potential realization of our deferred tax assets and assesses the need for reducing the valuation allowance periodically. As of March 31, 2005 we determined that a valuation allowance is still required. As a result of the valuation allowance, we recognized a modest tax provision that primarily related to our foreign operations and certain U.S. deferred tax liabilities that could not be offset against our deferred tax assets. We will continue to evaluate the potential realization of our deferred tax assets during the remainder of 2005 to determine whether the valuation allowance should be reduced.

 

This excerpt taken from the BLTI 10-Q filed Sep 30, 2005.

NOTE 7 – INCOME TAXES

 

Based upon our operating losses during 2004 and the available evidence, management determined that it is more likely than not that the deferred tax assets as of December 31, 2004 would not be realized. Consequently, we recorded a valuation allowance for our net deferred tax asset in the amount of $21,100,000 as of December 31, 2004. In this determination, we considered factors such as our earnings history, future projected earnings and tax planning strategies. If sufficient evidence of our ability to generate sufficient future taxable income becomes apparent, we may reduce our valuation allowance, resulting in income tax benefits in our statement of operations and in additional paid-in-capital. Management continues to evaluate the potential realization of our deferred tax assets and assesses the need for reducing the valuation allowance periodically. As of June 30, 2005 we determined that a valuation allowance is still required. As a result of the valuation allowance, we recognized a modest tax provision that primarily related to our foreign operations and certain U.S. deferred tax liabilities that could not be offset against our deferred tax assets. We will continue to evaluate the potential realization of our deferred tax assets during the remainder of 2005 to determine whether the valuation allowance should be reduced.

 

This excerpt taken from the BLTI 10-K filed Jul 19, 2005.

Income Taxes

 

Differences between accounting for financial statement purposes and accounting for tax return purposes are stated as deferred tax assets or deferred tax liabilities in the accompanying consolidated financial statements. The provision for income taxes represents the tax payable for the period and the change during the period in deferred tax assets and liabilities. We establish a valuation allowance when it is more likely than not that the deferred tax assets are not realizable.

 

This excerpt taken from the BLTI 10-Q filed Jul 19, 2005.

NOTE 8 – INCOME TAXES

 

As of December 31, 2003, the valuation reserves on our deferred tax assets were reduced and we recognized an income tax benefit and established deferred tax assets of $14.2 million. For the three months ended March 31, 2004, we have recorded a provision for income tax expense of $408,000 (restated) with a corresponding reduction of deferred tax assets. Income taxes will not be payable, subject to any alternative minimum tax, until we have utilized our net operating loss carryforwards, which were approximately $32.4 million (restated) as of December 31, 2003. For the three months ended March 31, 2003, we did not record a provision for income tax expense since we had not determined at that time that the realization of our deferred tax assets was more likely than not.

 

Page 19


Table of Contents

BIOLASE TECHNOLOGY, INC.

 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

 

This excerpt taken from the BLTI 10-Q filed Jul 19, 2005.

NOTE 9 – INCOME TAXES

 

As of December 31, 2003, the valuation reserves on our deferred tax assets were reduced and we recognized an income tax benefit and established net deferred tax assets of $14.2 million. We have recorded a provision for income tax expense of $565,000 and $973,000, respectively, for the three and six months ended June 30, 2004 which reduced our deferred tax assets. Income taxes will not be payable, subject to any alternative minimum tax, until we have utilized our net operating loss carryforwards, which were approximately $32.4 million as of December 31, 2003. For the three and six months ended June 30, 2003, we recorded a full valuation allowance against our net deferred tax assets due to the uncertainty of their realization, excluding the deferred tax liability that arises as a result of the amortization of goodwill and our indefinite-lived intangible asset that are deductible for tax purposes. As a result, we recorded a $13,000 provision for income taxes for the three and six months ended June 30, 2003.

 

Page 21


Table of Contents

BIOLASE TECHNOLOGY, INC.

 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

 

This excerpt taken from the BLTI 10-Q filed Jul 19, 2005.

NOTE 9 – INCOME TAXES

 

As of December 31, 2003, the valuation reserves on our deferred tax assets were reduced and we recognized an income tax benefit and established net deferred tax assets of $14.2 million. We have recorded a benefit for income tax of $745,000 and a provision for income tax expense of $228,000 for the three and nine months ended September 30, 2004, respectively, which adjusted our deferred tax assets. Income taxes will not be payable, subject to any alternative minimum tax, until we have utilized our net operating loss carryforwards, which were approximately $32.4 million as of December 31, 2003. For the three and nine months ended September 30, 2003, we recorded a full valuation allowance against our net deferred tax assets due to the uncertainty of their realization, excluding the deferred tax liability that arises as a result of the amortization of goodwill on our indefinite-lived intangible asset that are deductible for tax purposes. As a result, we recorded a provision for income taxes of $25,000 and $38,000 for the three and nine months ended September 30, 2003, respectively.

 

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