v3.25.4
INCOME TAXES
 12 Months Ended
Jan. 31, 2024
INCOME TAXES  
INCOME TAXES

Note 8 – INCOME TAXES

 

The Company has not made provision for income taxes for the years ended January 31, 2024 and 2023 since the Company has the benefit of net operating losses in these periods.

 

Due to uncertainties surrounding the Company’s ability to generate future taxable income to realize deferred income tax assets arising as a result of net operating losses carried forward, the Company has not recorded any deferred income tax assets as of January 31, 2024. The Company has incurred a net operating loss (NOL) of $4,962,328; the net operating loss carry forwards will begin to expire in varying amounts beginning with the year ended December 31, 2039, subject to its eligibility as determined by respective tax regulating authorities. NOLs generated in tax years prior to December 31, 2018, can be carryforward for twenty years, whereas NOLs generated after December 31, 2018, can be carryforward indefinitely. The Company’s net operating loss carry forwards may be subject to annual limitations, which could eliminate, reduce or defer the utilization of the losses because of an ownership change as defined in Section 382 of the Internal Revenue Code. U.S. Federal tax returns are closed by statute for years through 2015. The status of state and non-U.S. tax examinations varies due to the numerous legal entities and jurisdictions in which the Company operates.

 

The following is a reconciliation of the federal statutory tax rate to the effective tax rate:

 

 

 

Years Ended January 31,

 

 

 

2024

 

 

2023

 

Statutory federal income tax rate

 

 

21.00%

 

 

21.00%

State income taxes, net of federal tax benefit

 

 

-

 

 

 

-

 

Valuation allowance

 

(21.00

%)

 

(20.84

%)

Other, net

 

 

-

 

 

(0.04

%)

Effective tax rate

 

 

0.00%

 

 

0.12%

 

The components of the income tax provision/(benefit) are as follows:

 

 

 

Years Ended January 31,

 

 

 

2024

 

 

2023

 

Current:

 

 

 

 

 

 

Federal

 

$-

 

 

$-

 

State

 

 

-

 

 

 

800

 

Total current

 

 

-

 

 

 

800

 

Deferred:

 

 

 

 

 

 

 

 

Federal

 

 

-

 

 

 

(6,181)

State

 

 

-

 

 

 

-

 

Total deferred

 

 

-

 

 

 

(6,181)

Total income tax provision

 

$-

 

 

$(5,381)

 

The tax effects of cumulative temporary differences that gave rise to the deferred tax assets and liabilities were as follows:

 

 

 

 Years Ended January 31,

 

 

 

2024

 

 

2023

 

Deferred tax assets :

 

 

 

 

 

 

Allowance for credit loss

 

$7,063

 

 

$7,063

 

Impairment expense

 

 

2,194

 

 

 

-

 

Stock based-compensation

 

 

34,555

 

 

 

-

 

Operating lease liability

 

 

19,600

 

 

 

55,226

 

Net operating loss carryforward

 

 

1,041,256

 

 

 

865,309

 

Other, net

 

 

-

 

 

 

168

 

Total deferred tax assets

 

 

1,104,668

 

 

 

927,766

 

Valuation allowance

 

 

(1,078,716)

 

 

(868,172)

Net deferred tax assets

 

 

25,952

 

 

 

59,594

 

 

 

 

 

 

 

 

 

 

Deferred tax liabilities:

 

 

 

 

 

 

 

 

Amortization and depreciation

 

 

(7,125)

 

 

(5,901)

Operating lease right-of-use assets

 

 

(18,827)

 

 

(53,693)

Total deferred tax liabilities

 

 

(25,952)

 

 

(59,594)

 

 

 

 

 

 

 

 

 

Net deferred tax assets (liabilities)

 

$-

 

 

$-