Quarterly report pursuant to Section 13 or 15(d)

INCOME TAXES

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INCOME TAXES
3 Months Ended
Mar. 31, 2022
Income Tax Disclosure [Abstract]  
Income Tax Disclosure [Text Block]

NOTE 11 INCOME TAXES

 

FASB ASC 740-10, “Accounting for Uncertainty in Income Taxes” (“ASC 740-10”) prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company has analyzed filing positions in all of the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years in these jurisdictions. The Company does not have any unrecognized tax benefits.

 

The recognized deferred tax asset is based upon the expected utilization of its benefit from future taxable income. The Company has federal net operating loss (“NOL”) carryforwards of approximately $5,400,000 as of March 31, 2022, which is subject to limitations under Section 382 of the Internal Revenue Code. These carryforward losses are available to offset future taxable income and a portion begin to expire in the year 2025 to 2033.

 

The tax effect of temporary differences, primarily net operating loss carryforwards, asset reserves and depreciation, gave rise to the Company’s deferred tax asset. Deferred income taxes are recognized for the tax consequence of such temporary differences at the enacted tax rate expected to be in effect when the differences reverse. The Company had approximately $989,000 and $991,000 in deferred tax assets at March 31, 2022 and December 31, 2021, respectively.

 

For the three months ended March 31, 2022, the Company’s Federal and State provision requirements were calculated based on the estimated tax rate. For the three months ended March 31, 2022, the Company recorded a tax provision of $2,088 as compared to a tax provision of $128,569 for the three months ended March 31, 2021.