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INCOME TAXES | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
INCOME TAXES | NOTE 12 – INCOME TAXES The Company accounts for income taxes in accordance with ASC Topic No. 740, Income Taxes. This standard requires the Company to provide a net deferred tax asset or liability equal to the expected future tax benefit or expense of temporary reporting differences between book and tax accounting and any available operating loss or tax credit carry forwards. After applying the provisions of Section 382 of the Internal Revenue Code, the unexpired net operating loss (“NOL”) carryforward at December 31, 2024 was approximately $57.5 million, of which, approximately $26.5 million, generated in 2017 and prior, will expire between 2024 and 2037. Under the Tax Cuts and Jobs Act, the NOL generated from 2018 through 2024, of approximately $30.9 million, will have an indefinite carryforward period but can generally only be used to offset 80% of taxable income in any particular year. The Company may be subject to certain limitations in its annual utilization of NOL carry forwards to off-set future taxable income pursuant to Section 382 of the Internal Revenue Code, which could result in NOLs expiring unused. The components of the deferred income tax assets and liabilities consisted of the following: SCHEDULE OF DEFERRED TAX ASSETS
|  | 2024 |  |  | 2023 |
|  | As of December 31, |
|  | 2024 |  |  | 2023 |
Deferred tax assets |  |  |  |  |  |  |  |
Net operating loss carry forwards |  | $ | 12,907,965 |  |  | $ | 12,467,570 |
Research and development costs |  |  | 3,006,029 |  |  |  | 2,119,193 |
Stock compensation expense |  |  | 789,373 |  |  |  | 711,598 |
Accrued expenses |  |  | 7,330 |  |  |  | 528,148 |
Lease liability |  |  | 389,882 |  |  |  | 512,668 |
Contingent liability |  |  | 221,065 |  |  |  | 221,028 |
Acquisition liability |  |  | 112,722 |  |  |  | 176,629 |
Bad debt and other reserves |  |  | 287,900 |  |  |  | 129,924 |
Inventory reserves |  |  | 130,605 |  |  |  | 109,176 |
Other temporary differences |  |  | 1,049,365 |  |  |  | 203,340 |
Total deferred tax assets |  |  | 18,902,236 |  |  |  | 17,179,274 |
Deferred tax liabilities |  |  |  |  |  |  |  |
Depreciation and amortization |  |  | (5,683,259 | ) |  |  | (6,180,688 | )
Right of Use assets |  |  | (353,763 | ) |  |  | (487,402 | )
Accrued expenses |  |  | - |  |  |  | (424,423 | )
Contingent liability |  |  | (38,308 | ) |  |  | (130,802 | )
Other temporary differences |  |  | (294,608 | ) |  |  | (166,712 | )
Valuation allowance |  |  | (12,532,298 | ) |  |  | (9,789,247 | )
Net deferred tax asset |  | $ | - |  |  | $ | - |
A 100% valuation allowance has been provided for all deferred tax assets, as the ability of the Company to generate sufficient taxable income in the future is uncertain. Reconciliations of the expected federal income tax expense (benefit) based on the statutory income tax rate of 21% to the actual benefit for the years ended December 31, 2024 and 2023 are listed below. SCHEDULE OF INCOME TAX EXPENSE (BENEFIT)
|  | 2024 |  |  | 2023 |
|  | For the Year Ended December 31, |
|  | 2024 |  |  | 2023 |
Expected federal income tax benefit |  | $ | (2,019,060 | ) |  | $ | (903,220 | )
State and local taxes, net of federal benefit |  |  | (338,138 | ) |  |  | (226,714 | )
Fair value adjustments |  |  | (497,373 | ) |  |  | (819,270 | )
Share-based compensation |  |  | (237,838 | ) |  |  | (557,168 | )
Other permanent differences |  |  | 199,857 |  |  |  | 118,765 |
NOL carryover adjustments |  |  | 97,806 |  |  |  | (5,148,128 | )
Intangibles |  |  | - |  |  |  | (720,407 | )
Other true ups |  |  | 90,343 |  |  |  | (230,474 | )
Changes in tax rates |  |  | 9,732 |  |  |  | 673,449 |
Change in valuation allowance |  |  | 2,743,051 |  |  |  | 7,813,167 |
Income tax expense |  | $ | 48,380 |  |  | $ | - |
All tax years starting with 2021 are open for examination. The Company’s 2022 federal tax return was under audit as of March 24, 2025.

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