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INCOME TAXES
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
INCOME TAXES

NOTE 12: INCOME TAXES

 

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and deferred tax liabilities are as follows as of December 31:

SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

   December 31, 2024   December 31, 2023 
         
Non-operating loss carryforward  $7,680,000   $6,677,000 
Valuation allowance   (7,680,000)   (6,677,000)
Net deferred tax asset  $-   $- 

 

The Company has established a valuation allowance against its deferred tax assets due to the uncertainty surrounding the realization of such assets. During 2024 the valuation allowance increased by $1,003,000. The Company has net operating and economic loss carry-forwards of approximately $33,388,677 available to offset future federal and state taxable income.

 

A reconciliation between expected income taxes, computed at the federal income tax rate of 21% applied to the pretax accounting loss, and our blended state income tax rate of 2.0%, and the income tax net expense included in the consolidated statements of operations for the years ended December 31, 2024 and 2023 is as follows:

SCHEDULE OF STATUTORY FEDERAL INCOME TAX RATE LOSSES BEFORE INCOME TAX

   2024   2023 
   Years Ended December 31, 
   2024   2023 
         
Loss for the year  $(6,087,182)  $(4,244,708)
           
Income tax (recovery) at statutory rate  $(1,266,000)  $(891,000)
State income tax expense, net of federal tax effect   (121,000)   (85,000)
Permanent difference and other   384,000    287,000 
Change in valuation allowance   1,003,000    689,000 
Income tax expense per books  $-   $- 

 

The effective tax rate of 0% differs from our statutory rate of 21% primarily due to the effect of non-deductible income and expenses. Tax returns for the years ended 2013 – 2024, are subject to review by the tax authorities.