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Summary of Significant Accounting Policies (Tables)
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12 Months Ended |
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Dec. 31, 2013
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| Accounting Policies [Abstract] |
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| Effect of Adjustments to Revise Balance Sheet |
The following are selected line items from our balance sheet as of
December 31, 2012, illustrating the effect of the adjustments to
revise such statements:
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As Previously
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Reported |
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Adjustment |
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As Revised |
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Consolidated Balance Sheet as of December 31, 2012:
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Other assets(1)
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$ |
285,521 |
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$ |
484,947 |
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$ |
770,468 |
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Total assets
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40,500,901 |
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484,947 |
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40,985,848 |
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Deferred tax liability
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(258,729 |
) |
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(484,947 |
) |
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(743,676 |
) |
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Total liabilities
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(32,364,175 |
) |
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(484,947 |
) |
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(32,849,122 |
) |
| (1) |
As previously reported, Other assets
included $234,891 of income taxes receivable as of December 31,
2012. |
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| Effect of Adjustments to Revise Cash Flows |
The following are selected line items from our statement of cash
flows as of December 31, 2012, illustrating the effect of the
adjustments to revise such statements:
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As Previously
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Reported |
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Adjustment |
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As Revised |
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Consolidated Statement of Cash Flows as of December 31,
2012:
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Deferred income taxes
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$ |
83,728 |
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$ |
484,947 |
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$ |
568,675 |
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Changes in operating assets and liabilities – Other
assets
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(124,184 |
) |
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(484,947 |
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(609,131 |
) |
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| Delineates Current and Deferred Portions of Income Tax Provision |
In addition, the footnote disclosure which delineates the current
and deferred portions of the income tax provision was impacted as
follows:
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For the Year Ended December 31,
2012 |
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As Previously
Reported |
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Adjustment |
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As Revised |
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Current portion
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$ |
216,591 |
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$ |
(484,947 |
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$ |
(268,356 |
) |
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Deferred portion
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83,728 |
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484,947 |
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568,675 |
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Total income taxes
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300,319 |
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— |
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300,319 |
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| Reconciliation between the U.S. Statutory Federal Income Tax Rate and Effective Income Tax Rate |
A reconciliation between the U.S. statutory federal income tax rate
and our effective income tax rate for the years ended
December 31, 2013, 2012 and 2011 is provided in the following
table:
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2013 |
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2012 |
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2011 |
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U.S. statutory federal income tax rate
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0.0 |
% |
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34.0 |
% |
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34.0 |
% |
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State taxes, net of U.S. federal income tax benefit(1)
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41.7 |
% |
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4.0 |
% |
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10.2 |
% |
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Other adjustments(2)
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473.4 |
% |
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-4.7 |
% |
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10.5 |
% |
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Effective tax rate
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515.1 |
% |
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33.3 |
% |
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54.7 |
% |
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| (1) |
From 2010 to 2012, California state
tax returns were filed on a unitary basis with our Adviser. In
2011, we began filing state tax returns in Florida, and, for 2013,
we will also begin filing state tax returns in Arizona, Michigan
and Oregon. The overall state tax rate is higher due to the
deferred intercompany gain mentioned above, which is a fixed amount
due to the state of California and is not based on the amount of
income apportioned to the state. |
| (2) |
Adjustments made to the 2013 income
tax provision related primarily to the recognition of $2.1 million
of income taxes on a deferred intercompany gain relating to land
transfers from prior years. This tax will become due upon our
election to be taxed as a REIT, which we intend to do for the year
ended December 31, 2013. This was partially offset by the
reversal of our deferred tax liability, which resulted in a benefit
of REIT conversion of $743,676. |
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| Breakdown between Current and Deferred Income Taxes |
The following table shows the breakdown between the current and
deferred income taxes for the years ended December 31, 2012
and 2011:
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2012 |
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2011 |
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Current portion
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$ |
(268,356 |
) |
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$ |
181,168 |
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Deferred portion
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568,675 |
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(173,657 |
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Total income taxes
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$ |
300,319 |
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$ |
7,511 |
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