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Income Taxes | 12 Months Ended
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Dec. 31, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | NOTE M – INCOME TAXES As of December 31, 2021, the Company had consolidated income tax net operating loss (“NOL”) carryforwards for federal tax purposes of approximately $208,889,722 and net operating loss carryforwards for foreign income tax purposes of approximately $74,888,328. The federal NOL carryforwards from 2005 and forward will expire in various years beginning 2025 and ending through the year 2035. From 2025 through 2027, approximately $47 million of the NOL will expire, and from 2028 through 2037, approximately $128 million of the NOL will expire. The NOL generated in 2018 through 2021 of approximately $34M will be carried forward indefinitely. The components of the provision for income tax (benefits) are attributable to continuing operations as follows:
|  | December 31, 2021 |  |  | December 31, 2020 |  |  | December 31, 2019 |
Current |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | — |  |  | $ | — |  |  | $ | — |
State |  |  | — |  |  |  | — |  |  |  | — |
|  | $ | — |  |  | $ | — |  |  | $ | — |
Deferred |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | — |  |  | $ | — |  |  | $ | — |
State |  |  | — |  |  |  | — |  |  |  | — |
|  | $ | — |  |  | $ | — |  |  | $ | — |
Deferred income taxes reflect the net tax effects of the temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows:
|  | December 31, 2021 |  |  | December 31, 2020 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss and tax credit carryforwards |  | $ | 72,201,754 |  |  | $ | 66,867,637 |
Capital loss carryforward |  |  | 5,514 |  |  |  | 5,683 |
Accrued expenses |  |  | 363,149 |  |  |  | 253,374 |
Start-up costs |  |  | 5,664 |  |  |  | 5,837 |
Excess of book over tax depreciation |  |  | 259,667 |  |  |  | 394,649 |
Stock option and restricted stock award expense |  |  | 1,429,488 |  |  |  | 1,464,210 |
Debt Extinguishment |  |  | 58,161 |  |  |  | 59,934 |
Less: valuation allowance |  |  | (74,138,667 | ) |  |  | (68,859,984 | )
|  | $ | 184,730 |  |  | $ | 191,340 |
Deferred tax liability: |  |  |  |  |  |  |  |
Property and equipment basis |  | $ | 10,434 |  |  | $ | 48,545 |
Prepaid expenses |  |  | 174,296 |  |  |  | 142,795 |
|  | $ | 184,730 |  |  | $ | 191,340 |
Net deferred tax asset |  | $ | — |  |  | $ | — |
As reflected above, we have recorded a net deferred tax asset of $0 at December 31, 2021. As required by the Accounting for Income Taxes topic in the ASC, we have evaluated whether it is more likely than not that the deferred tax assets will be realized. Based on the available evidence, we have concluded that it is more likely than not that those assets would not be realized without the recovery and rights of ownership or salvage rights of high-value shipwrecks or other forms of taxable income, thus a valuation allowance has been recorded as of December 31, 2021. The change in the valuation allowance is as follows:
December 31, 2021 |  | $ | 74,138,667 |
December 31, 2020 |  |  | 68,859,984 |
Change in valuation allowance |  | $ | 5,278,683 |
The federal and state income tax provision (benefit) is summarized as follows for the years ended:
|  | December 31, 2021 |  |  | December 31, 2020 |  |  | December 31, 2019 |
Expected (benefit) |  | $ | (3,386,834 | ) |  | $ | (4,429,419 | ) |  | $ | (3,254,942 | )
Effects of: |  |  |  |  |  |  |  |  |  |  |  |
State income taxes net of federal benefits |  |  | (570,116 | ) |  |  | (940,302 | ) |  |  | (156,858 | )
Nondeductible expense |  |  | (56,839 | ) |  |  | 150,238 |  |  |  | 262,776 |
Subpart F Income |  |  | 735,229 |  |  |  | 345,006 |  |  |  | — |
Debt Extinguishment |  |  | — |  |  |  | 91,266 |  |  |  | — |
Funder Loan Proceeds |  |  | — |  |  |  | 2,482,252 |  |  |  | — |
Change in valuation allowance |  |  | 6,229,371 |  |  |  | 4,815,784 |  |  |  | 5,170,161 |
Foreign Rate Differential |  |  | (2,950,811 | ) |  |  | (2,514,825 | ) |  |  | (2,021,137 | )
|  | $ | — |  |  | $ | — |  |  | $ | — |
The Company’s effective income tax rate is lower than what would be expected if the federal statutory rate were applied to income before income taxes primarily because of certain expenses deductible for financial reporting purposes that are not deductible for tax purposes, research and development tax credits, operating loss carryforwards, and adjustments to previously-recorded deferred tax assets and liabilities due to the enactment of the Tax Cuts and Jobs Act. We have not recognized a material adjustment in the liability for unrecognized tax benefits and have not recorded any provisions for accrued interest and penalties related to uncertain tax positions. The earliest tax year still subject to examination by a major taxing jurisdiction is 2017.

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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=121826272&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=122134291&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=121826272&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=122134291&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=121826272&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 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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