v3.26.1
Income Taxes
 3 Months Ended
Mar. 31, 2026
Income Taxes [Abstract]  
INCOME TAXES

11. INCOME TAXES

 

Income tax (benefit) expense for the three months ended March 31, 2026 and 2025 were $0 and $0, respectively.

 

The income tax expense applicable to income before income taxes consists of the following

 

   Three Months Ended
March 31,		 
   2026   2025 
Current income taxes:          
Federal   -    - 
State   -    
-
 
Foreign   -    - 
Total Current   -    - 
Deferred income taxes:          
Federal   -    - 
State   -    - 
Foreign   -    - 
Total deferred   -    - 
Income tax expenses   -    - 

 

Loss before income tax consists of the following

 

   Three Months Ended
March 31,		 
   2026   2025 
U.S.   (1,471,693)   (706,088)
Foreign   (218,244)   (238,012)
Loss before income tax  $(1,689,937)  $(944,190)

 

The income tax expense (benefit) differs from the amount computed by applying the US federal statutory rate of 21.0% to income before income taxes for three months ended March 31, 2025 and 2026, respectively, as follows:

 

    Three months ended
March 31, 2026		  
US Federal Statutory Tax Rate     (354,887 )     21.0 %
State and Local Income Taxes, net of Federal Income Tax Effect     (30,004 )     1.8 %
Foreign tax effects                
Taiwan-reduced statutory tax rate on qualifying income     12,746       (0.8 )%
Effect of Cross-boarder tax laws    
-
      
-
 %
Tax credits    
-
      
-
 %
Nontaxable or non-deductible items                
Stock-based compensation     165,349       (9.8 )%
others     6,597       (0.4 )%
Change in valuation allowances     200,199       (11.8 )%
Others (1)    
-
      
-
 %
Income tax expenses    
-
      
-
 %
   Three months ended
March 31, 2025		 
US Federal Statutory Tax Rate   (198,071)   21.0%
State and Local Income Taxes, net of Federal Income Tax Effect   (18,628)   2.0%
Foreign tax effects          
Taiwan-reduced statutory tax rate on qualifying income   2,381    (0.3)%
Effect of Cross-boarder tax laws   
-
    
-
%
Tax credits   
-
    
-
%
Nontaxable or non-deductible items          
Stock-based compensation   10,242    (1.1)%
others   10,684    (1.1)%
Change in valuation allowances   193,393    (20.5)%
Others (1)   
-
    
-
%
Income tax expenses   
-
    
-
%

 

(1)includes the tax effects of enactment of new tax laws and change in unrecognized tax benefits.

 

The amount of cash paid for income taxes (net of refunds) for the three months ended March 31, 2026 and 2025 is as follows:

 

   Three Months Ended
March 31,		 
   2026   2025 
Federal   
-
    
-
 
State   
-
    
-
 
Foreign   
 
    
-
 
Taiwan   5,944    
 
 
Total Current   5,944    
-
 

 

Deferred tax assets (liability) as of March 31, 2026 and December 31, 2025 consist approximately of:

 

   March 31,   December 31, 
   2026   2025 
Loss on impairment of assets   881,855    881,855 
Net operating loss carryforwards   6,620,144    6,473,705 
Operating lease liabilities   430,604    446,376 
Operating lease assets   (427,183)   (445,321)
Deferred tax assets, gross   7,505,420    7,356,615 
Valuation allowance   (7,505,420)   (7,356,615)
Deferred tax assets, net   
-
    
-
 

 

A reconciliation of gross unrecognized tax benefits is as follows:

 

   March 31,   December 31, 
   2026   2025 
Balance at beginning of the period  $6,473,705   $5,677,413 
Increases in tax positions for current year-loss carryforward   200,199    796,292 
Balance at ending of the period  $6,673,904   $6,473,705