v3.26.1
Income Taxes
 6 Months Ended
Jun. 30, 2026
Income Taxes [Abstract]  
INCOME TAXES

11. INCOME TAXES

 

Income tax (benefit) expense for the six months ended June 30, 2026 and 2025 were $0 and $23,627, respectively.

 

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

 

    Six Months Ended
June 30,		  
    2026     2025  
Current income taxes:            
Federal     -       -  
State     -       -  
Foreign     -       23,627  
Total Current     -       23,627  
Deferred income taxes:                
Federal     -       -  
State     -       -  
Foreign     -       -  
Total deferred     -       -  
Income tax expenses     -       23,627  

 

Loss before income tax consists of the following

 

    Six Months Ended
June 30,		  
    2026     2025  
U.S.     (2,088,301 )     (2,785,284 )
Foreign     (412,117 )     (468,112 )
Loss before income tax   $ (2,500,418 )   $ (3,253,396 )

 

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 six months ended June, 2026 and 2025, respectively, as follows:

 

    Six Months Ended
June 30, 2026		     Six Months Ended
June 30, 2025		  
US Federal Statutory Tax Rate   $ (525,088 )     21.0 %   $ (683,213 )   $ 21.0 %
State and Local Income Taxes, net of Federal Income Tax Effect     (54,728 )     2.2 %     (29,304 )     0.9 %
Foreign tax effects                                
Taiwan-reduced statutory tax rate on qualifying income     12,365       (0.5 )%     4,681       (0.1 )%
Effect of Cross-boarder tax laws     -       - %     -       - %
Tax credits     -       - %     -       - %
Nontaxable or non-deductible items                                
Stock-based compensation     218,487       (8.7 )%     340,281       (10.5 )%
others     11,798       (0.5 )%     17,448       (0.5 )%
Change in valuation allowances     337,166       (13.5 )%     373,734       (11.5 )%
Others (1)     -       - %     -       - %
Income tax expenses     -       - %     23,627       (0.7 )%

 

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

 

The amount of cash (refund) paid for income taxes for the six months ended June 30, 2026 and 2025 is as follows:

 

    Six Months Ended
June 30,		  
    2026     2025  
Federal     -       -  
State     -       -  
Foreign             -  
Taiwan     (1,209 )     1,969  
Total Current     (1,209 )     1,969  

 

Deferred tax assets (liability) as of June 30, 2026 and December 31, 2025 consist approximately of:

 

    June 30,     December 31,  
    2026     2025  
Loss on impairment of assets     881,855       881,855  
Net operating loss carryforwards     6,810,871       6,473,705  
Operating lease liabilities     413,886       446,376  
Operating lease assets     (409,757 )     (445,321 )
Deferred tax assets, gross     7,696,855       7,356,615  
Valuation allowance     (7,696,855 )     (7,356,615 )
Deferred tax assets, net     -       -  

 

A reconciliation of gross unrecognized tax benefits is as follows:

 

The Company had no unrecognized tax benefits or related interest and penalties accrued as of June 30, 2026 or December 31, 2025. The Company’s accounting policy is to recognize any interest and penalties related to uncertain tax positions as components of income tax expense.