v3.4.0.3

Income Taxes | 12 Months Ended
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Dec. 31, 2015
Income Tax Disclosure [Abstract] |
Income Taxes |
NOTE 16 | INCOME TAXES
Under the lifestyle segment, the Company provides for income taxes under ASC 740, Accounting for Income Taxes. ASC 740 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse. The Company’s predecessor operated as entity exempt from Federal and State income taxes. ASC 740 requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of approximately $51.5 million for federal income tax reporting purposes are subject to annual limitations. When a change in ownership occurs, net operating loss carry forwards may be limited as to use in future years. Due to net operating loss carryforwards, income tax returns remain subject to examination by federal and most state tax authorities. The tax loss carry-forwards are available to offset future taxable income with the federal and state carry-forwards beginning to expire in 2023. The Company has evaluated its tax positions for years which remain subject to examination by major tax jurisdictions, in accordance with the requirements of ASC 740 and as a result concluded no adjustment was necessary. The Company files income tax returns in the U.S. federal jurisdiction, and various state jurisdictions. For 2015, the Company’s subsidiary, GreenShift does not plan on making the election to be included in Bitzio’s consolidated tax returns, thus it is presented below as a separate taxpaying component. The Company’s evaluation of uncertain tax positions was performed for the tax years ended December 31, 2011 and forward, the tax years which remain subject to examination by major tax jurisdictions as of December 31, 2015. There were no unrecognized tax benefits. Interest and penalties related to uncertain tax positions will be recognized in income tax expense. As of December 31, 2015, no interest related to uncertain tax positions had been accrued. The provision for income taxes for the years ended December 31, 2015 and December 31, 2014 consisted of the following:
|  | 2015 |  |  | 2014 |
Current provision: |  |  |  |  |  |  |  |
Federal |  | $ | 143,957 |  |  | $ | — |
State |  |  | 2,520 |  |  |  | — |
Total current provision |  |  | 146,477 |  |  |  | — |
Deferred provision (benefit) for tax: |  |  |  |  |  |  |  |
Federal |  |  | — |  |  |  | — |
State |  |  | — |  |  |  | — |
Total deferred provision (benefit) for tax |  |  | — |  |  |  | — |
Total provision for tax |  | $ | 146,477 |  |  | $ | — |
The Company has more than one taxpaying component which is composed of GreenShift and all the other consolidated entities (“Bitzio”) that reflect the tax provision on a separate return basis. The provision for income taxes differs from the amounts which would be provided by applying the statutory federal income tax rate of 34% to the net loss before provision for income taxes for the following reasons:
|  | Bitzio 12/31/15 |  |  | GreenShift 12/31/15 |  |  | Total 12/31/15 |
Book income (loss) before income taxes |  | $ | 206,636 |  |  | $ | 5,424,623 |  |  | $ | 5,631,259 |
Stock options issued for services |  |  | 113,560 |  |  |  | — |  |  |  | 113,560 |
Interest expense on convertible notes |  |  | 205,090 |  |  |  | 345,545 |  |  |  | 550,635 |
Interest related to conversion features |  |  | — |  |  |  | 1,435,664 |  |  |  | 1,435,664 |
Amortization of Goodwill |  |  | (125,274 | ) |  |  | — |  |  |  | (125,274 | )
Change in derivative liability |  |  | (977,784 | ) |  |  | (353,762 | ) |  |  | (1,331,546 | )
Investee loss |  |  | — |  |  |  | 218,729 |  |  |  | 218,729 |
Utilization of net operating loss carryforwards |  |  | — |  |  |  | (2,626,962 | ) |  |  | (2,626,962 | )
Gain on extinguishment of debt |  |  | — |  |  |  | (4,146,945 | ) |  |  | (4,146,945 | )
Other |  |  | — |  |  |  | (150,415 | ) |  |  | (150,415 | )
Change in valuation allowance |  |  | 577,772 |  |  |  | — |  |  |  | 577,772 |
Income tax expense |  |  | — |  |  |  | 146,477 |  |  |  | 146,477 |
|  | Bitzio 12/31/14 |
Book income (loss) from operations |  |  | (1,373,641 | )
Interest expense on convertible notes |  |  | 184,198 |
Amortization of Goodwill |  |  | (125,274 | )
Change in derivative liability |  |  | 695,061 |
Change in valuation allowance |  |  | 619,656 |
Income tax expense |  |  | — |
In assessing whether the deferred tax assets are realizable, Management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible. Management believes it is more likely than not that the Company will not realize the benefits of these deductible differences. The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carry forward period are reduced. Net deferred tax assets consist of the following components as of:
|  | Bitzio 12/31/15 |  |  | GreenShift 12/31/15 |  |  | Total 12/31/15 |
Net operating loss carry forwards (expire through 2035) |  | $ | 6,413,913 |  |  | $ | 11,088,465 |  |  | $ | 17,502,378 |
Stock/options issued for services |  |  | 534,877 |  |  |  | — |  |  |  | 534,877 |
Allowance for doubtful accounts |  |  | — |  |  |  | 41,000 |  |  |  | (41,000 | )
Total gross deferred tax asset/liabilities |  |  | 6,948,790 |  |  |  | 11,047,465 |  |  |  | 17,996,255 |
Valuation allowance |  |  | (6,948,790 | ) |  |  | (11,047,465 | ) |  |  | (17,996,255 | )
Net deferred taxes |  |  | — |  |  |  | — |  |  |  | — |
|  | Bitzio 12/31/14 |
Net operating loss carry forwards (expire through 2034) |  |  | 5,836,142 |
Stock/options issued for services |  |  | 421,317 |
Total gross deferred tax asset/liabilities |  |  | 6,257,459 |
Valuation allowance |  |  | (6,257,459 | )
Net deferred taxes |  |  | — |

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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