v3.25.2
Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes

Note 13 – Income Taxes

 

Components of income tax expense /benefit for the year ended December 31, 2024 and December 31, 2023 are as follows:

 

   2024   2023 
Current Income Tax Expense (Benefit) - Federal   -    - 
Current Income Tax Expense (Benefit) - State   -    - 
Total Current Income Tax Expense (Refund)   -    - 
           
Deferred Income Tax Expense (Benefit) - Federal   -    - 
Deferred Income Tax Expense (Benefit) - State   -    - 
Total Deferred Income Tax Expense (Benefit)   -    - 
           
Total Provision for Income Taxes   -    - 

 

The tax effects of cumulative temporary differences which give rise to the significant portions of deferred tax assets or liabilities at December 31, 2024 and 2023 are as follows:

 

  2024   2023 
Deferred Tax Assets:  2024   2023 
Reserves & Allowances   61,864    108,584 
Accrued Payroll Expenses   -    - 
Other Accrued Expenses   671,345    - 
Straight-Line Rent Accrual   -    - 
Interest Expense   -    - 
Carryforward of Sec. 179   -    - 
Charitable Contribution Carryforward   2,895    2,895 
Unrealized Gains/Losses on FX Exchange   -    - 
Net operating loss carryforward - Federal   12,529,285    9,524,275 
Net operating loss carryforward - State   2,807,579    2,194,071 
Tax Credits   -    - 
Non Qualified Stock Options   435,808    430,577 
Amortization   167,756    2,014,677 
Total deferred tax assets   16,676,532    14,275,079 
           
Deferred Tax Liabilities:          
Depreciation   (133,353)   (2,813)
Amortization   -    - 
    -    - 
Net deferred tax liability   (133,353)   (2,813)
           
Less Valuation Allowance   (16,543,179)   (14,272,266)
Total Net Deferred Tax Assets   -    - 

 

The Company has federal net operating loss carryforward of approximately $59.7 million and state net operating losses of approximately $59.7 million. There is no expiration of the federal loss carryforwards as all federal net operating loss carryforwards were generated after December 31, 2017. The state operating loss carryforwards are subject to expiration beginning on December 31, 2031.

 

ASC 740 requires a valuation allowance to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. At December 31, 2024 and 2023, a full valuation allowance was required.

 

In addition, the Company performed a comprehensive review of its uncertain tax positions and determined that no liabilities or related interest and penalties were necessary relating to unrecognized tax benefits at December 31, 2024. The Company’s federal and state income tax returns are subject to examination by taxing authorities for three years after the returns are filed, and the Company’s federal and state income tax returns for 2021 and 2023 remain open to examination. The primary state income tax returns are for Florida, Illinois, Kentucky,and Missouri. As of the date of these financial statements, the Company has not yet filed its federal and state income tax returns for the year ended December 31, 2023. The Company does not have any Uncertain Tax Positions (“UTPs”) as of the reporting date. However, if UTPs were to arise, the Company’s policy would be to recognize interest and penalties related to UTPs in the income statement as part of income tax expense.

 

 

The reconciliation of the computed effective tax rate to the U.S. federal statutory rate is as follows:

 

   2024   2023 
Federal statutory income tax   21.00%   21.00%
Permanent Differences   0.00%   0.00%
Change in Tax Credits   0.00%   0.00%
Change in Tax Rate   0.00%   0.00%
Change in Valuation Allowance   -24.72%   -23.23%
State income taxes, net of federal benefit   3.72%   3.72%
Prior Year Adjustments   0.00%   -1.49%
Total   0.00%   0.00%