| Schedule of Company’s Loss Before Income Taxes |
The Company’s
loss before income taxes includes the following components:
| | |
Years Ended December 31, | |
| | |
2025 | | |
2024 | |
| United States loss before income taxes | |
$ | 18,175,072 | | |
$ | 7,639,148 | |
| China loss before income taxes | |
| 85,904 | | |
| 264,246 | |
| Total loss before income taxes | |
$ | 18,260,976 | | |
$ | 7,903,394 | |
|
| Schedule of Components of Income Taxes Expense (Benefit) |
Components of income taxes expense (benefit) consisted
of the following:
| | |
Years Ended December 31, | |
| | |
2025 | | |
2024 | |
| Current: | |
| | |
| |
| U.S. federal | |
$ | - | | |
$ | - | |
| U.S. state and local | |
| - | | |
| - | |
| China | |
| - | | |
| - | |
| Total current income taxes expense | |
$ | - | | |
$ | - | |
| Deferred: | |
| | | |
| | |
| U.S. federal | |
$ | (3,585,262 | ) | |
$ | (4,874 | ) |
| U.S. state and local | |
| (1,213,867 | ) | |
| (1,650 | ) |
| China | |
| 77,641 | | |
| 93,437 | |
| Total deferred income taxes (benefit) | |
$ | (4,721,488 | ) | |
$ | 86,913 | |
| Change in valuation allowance | |
| 4,721,488 | | |
| (86,913 | ) |
| Total income taxes expense | |
$ | - | | |
$ | - | |
|
| Schedule of U.S. Statutory Rate and the Company’s Effective Tax Rate |
The table below summarizes the differences between
the U.S. statutory rate and the Company’s effective tax rate for the years ended December 31, 2025 and 2024:
| | |
Years Ended December 31, | |
| | |
2025 | | |
2024 | |
| U.S. federal rate | |
| 21.0 | % | |
| 21.0 | % |
| U.S. state rate | |
| 7.1 | % | |
| 6.4 | % |
| Permanent difference | |
| (4.2 | )% | |
| (1.3 | )% |
| Non-US rate differential | |
| 0.0 | % | |
| 0.1 | % |
| True ups | |
| 1.9 | % | |
| (27.3 | )% |
| U.S. valuation allowance | |
| (25.9 | )% | |
| 1.1 | % |
| Total provision for income taxes | |
| 0.0 | % | |
| 0.0 | % |
|
| Schedule of Deferred Taxes |
The Company’s components of deferred
taxes as of December 31, 2025 and 2024 were as follows:
| | |
December 31,
2025 | | |
December 31,
2024 | |
| Deferred tax assets | |
| | |
| |
| Stock-based compensation | |
$ | 1,410,079 | | |
$ | 1,598,257 | |
| Disallowed business interest deduction | |
| - | | |
| - | |
| Research and development expense | |
| 81,638 | | |
| 106,783 | |
| Accrued directors’ compensation | |
| 102,166 | | |
| 104,977 | |
| Accrued settlement | |
| 301,047 | | |
| 140,904 | |
| Partnership investment | |
| - | | |
| 2,167,965 | |
| Lease liability | |
| 1,687 | | |
| 1,687 | |
| Capital loss limitation | |
| 1,846,243 | | |
| 149,394 | |
| Net operating loss carryforward | |
| 22,942,772 | | |
| 17,648,077 | |
| Total deferred tax assets, gross | |
| 26,685,632 | | |
| 21,918,044 | |
| Valuation allowance | |
| (26,506,126 | ) | |
| (21,784,638 | ) |
| Total deferred tax assets, net | |
$ | 179,506 | | |
$ | 133,406 | |
| Deferred tax liabilities | |
| | | |
| | |
| Fixed assets and intangible assets book/tax basis difference | |
$ | (179,506 | ) | |
$ | (133,406 | ) |
| Right-of-use assets | |
| - | | |
| - | |
| Total deferred tax liabilities | |
$ | (179,506 | ) | |
$ | (133,406 | ) |
| Net deferred tax assets | |
$ | - | | |
$ | - | |
|