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Income Taxes | 12 Months Ended
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Sep. 30, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | NOTE 11. INCOME TAXES The Company utilizes the guidance issued by the FASB for accounting for income taxes which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each year-end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The provision for income taxes represents the tax payable for the period and the change during the period in deferred tax assets and liabilities. Components of the net deferred tax asset (liability) at September 30, 2020 and 2019 are as follows:
|  | September 30, |
|  | 2020 |  |  | 2019 |
Deferred Tax Assets |  |  |  |  |  |  |  |
Accrued Compensation |  | $ | 2,086,396 |  |  | $ | 1,310,466 |
Stock Compensation |  |  | 10,936,819 |  |  |  | 3,609,756 |
Capitalized Research & Development |  |  | 624,915 |  |  |  | 926,026 |
California Alternative Minimum Tax |  |  | 178,652 |  |  |  | 173,553 |
Fixed Assets |  |  | - |  |  |  | 438,882 |
Net Operating Losses |  |  | 151,007,113 |  |  |  | 105,372,571 |
Intangible Assets |  |  | 2,818,002 |  |  |  | 3,590,090 |
Deferred Revenue |  |  | 1,702,357 |  |  |  | - |
Right of Use Assets/Lease Liabilities |  |  | 1,015,626 |  |  |  | - |
Deferred Rent |  |  | - |  |  |  | 821,317 |
Capital Loss |  |  | 709,779 |  |  |  | 709,779 |
Total deferred tax assets |  |  | 171,079,659 |  |  |  | 116,952,440 |
Valuation allowance |  |  | (156,603,859 | ) |  |  | (108,232,402 | )
Deferred tax liabilities: |  |  |  |  |  |  |  |
Fixed Assets |  |  | (2,546,968 | ) |  |  | - |
State taxes |  |  | (11,928,832 | ) |  |  | (8,720,038 | )
Total deferred tax liability |  |  | (14,475,800 | ) |  |  | (8,720,038 | )
Net deferred tax assets (liabilities) |  | $ | - |  |  | $ | - |
The Company has concluded, in accordance with the applicable accounting standards, that it is more likely than not that the Company may not realize the benefit of all of its deferred tax assets. Accordingly, management has provided a 100% valuation allowance against its deferred tax assets until such time as management believes that its projections of future profits as well as expected future tax rates make the realization of these deferred tax assets more-likely-than-not. Significant judgment is required in the evaluation of deferred tax benefits and differences in future results from our estimates could result in material differences in the realization of these assets. The Company has performed an assessment of positive and negative evidence regarding the realization of the net deferred tax asset in accordance with FASB ASC 740-10, “Accounting for Income Taxes.” This assessment included the evaluation of scheduled reversals of deferred tax liabilities, the availability of carry forwards and estimates of projected future taxable income. As of September 30, 2020, the Company had available gross federal net operating loss (“NOL”) carry forwards of approximately $473.0 million and gross state NOL carry forwards of $497.0 million. The NOLs expire at various dates through 2040. The provisions for income taxes for the years ended September 30, 2020 and 2019 are as follows:
|  | September 30, |
|  | 2020 |  |  | 2019 |
Federal: |  |  |  |  |  |  |  |
Current |  |  | — |  |  |  | — |
Deferred |  |  | — |  |  |  | — |
Total Federal |  |  | — |  |  |  | — |
State: |  |  |  |  |  |  |  |
Current |  | $ | 2,400 |  |  |  | 173,553 |
Deferred |  |  | — |  |  |  | — |
Total State |  |  | 2,400 |  |  |  | 173,553 |
Provision from income taxes |  | $ | 2,400 |  |  | $ | 173,553 |
The Company’s effective income tax rate differs from the statutory federal income tax rate as follows for the years ended September 30, 2020 and 2019:
|  | September 30, |
|  | 2020 |  |  | 2019 |
At U.S. federal statutory rate |  |  | -21.0 | % |  |  | 21.0 | %
State taxes, net of federal effect |  |  | -7.0 | % |  |  | 7.3 | %
Stock compensation |  |  | -29.4 | % |  |  | -15.0 | %
Mark-to-market adjustments |  |  | 0.0 | % |  |  | 0.0 | %
Valuation allowance |  |  | 57.4 | % |  |  | -13.0 | %
Other |  |  | 0.0 | % |  |  | 0.0 | %
True-up on deferred taxes |  |  | 0.0 | % |  |  | 0.0 | %
Tax rate change |  |  | 0.0 | % |  |  | 0.0 | %
Effective income tax rate |  |  | 0.0 | % |  |  | 0.3 | %
The Company has adopted guidance issued by the FASB that clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold of more likely than not and a measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. In making this assessment, a company must determine whether it is more likely than not that a tax position will be sustained upon examination, based solely on the technical merits of the position and must assume that the tax position will be examined by taxing authorities. The Company’s policy is to include interest and penalties related to unrecognized tax benefits in income tax expense. The Company has not recognized any unrecognized tax benefits and does not have any interest or penalties related to uncertain tax positions as of September 30, 2020 and 2019. The Company files income tax returns with the Internal Revenue Service (“IRS”), the state of California and certain other taxing jurisdictions. The Company is subject to income tax examinations by the IRS and by state tax authorities until the net operating losses are settled.

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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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
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