
	2020		2019

Deferred Tax Assets
Net operating loss and tax credits	$	16,961,650	$	16,964,685
Property and equipment and intangibles	227,056		227,072
Allowance for accounts receivable	249,483		257,564
Reserve for expired product	438,235		469,466
Inventory	100,362		35,227
Deferred charges	952,711		845,765
Cumulative compensation costs incurred on deductible equity awards	928,638		1,047,149
Total deferred tax assets	19,858,135		19,846,928

Deferred Tax Liabilities
Intangible assets	(662,014)		(1,313,965)
Net deferred tax assets, before valuation allowance	19,196,121		18,532,963
Less: deferred tax asset valuation allowance	(19,196,121)		(18,511,161)
Net deferred tax assets	$	—	$	21,802

The following table summarizes the amount and year of expiration of the Company's federal and state net operating loss carryforwards as of December 31, 2020:


Years of expiration	Federal		State

2021	$	—	$	4,342,464
2022 - 2029	—		45,045,442
2030	44,153,819		458,802
2031 - 2039	7,534,351		9,829,212
Indefinite Period	4,796,324		263,861

Total federal and state net operating loss carryforwards	$	56,484,494	$	59,939,781


	2020		2019		2018

Current:
Federal	$	21,802	$	65,408	$	—
State and other	(55,902)		79,316		(16,636)
Total current income tax (expense) benefit	(34,100)		144,724		(16,636)

Deferred:
Federal	(21,802)		(65,408)		—
State	—		—		—
Total deferred income tax (expense) benefit	(21,802)		(65,408)		—
Total income tax (expense) benefit	$	(55,902)	$	79,316	$	(16,636)


	2020		2019		2018

Federal tax expense at statutory rate	21	%	21	%	21	%
State income tax expense (net of federal income tax benefit)	4	%	4	%	4	%
Permanent differences associated with general business credits	6	%	7	%	1	%
Change in valuation allowance	(23)	%	(31)	%	(25)	%
Other permanent differences	(7)	%	1	%	(1)	%
Other	(3)	%	—	%	—	%
Net income tax expense	(2)	%	2	%	—	%

The Company believes that it is not more likely than not that its net deferred tax assets will be realized. As such, the net deferred tax assets, with the exception of one noted below, are fully offset with a valuation allowance as of the periods ended December 31, 2020, December 31, 2019, and December 31, 2018.

The only deferred tax asset not offset with a valuation allowance as of the periods ended December 31, 2019 and December 31, 2018 was the Company’s AMT Credit Carryforward, which became refundable under the Tax Cuts and Jobs Act passed in 2017. The Company received the balance of the refund related to this credit during the period ended December 31, 2020, and as such, the deferred tax asset has been realized and all remaining deferred tax assets are fully offset with a valuation allowance as of December 31, 2020.

As of December 31, 2020, the Company has general business credit carryforwards of $1.7 million. These credit carryforwards will expire in years 2021 through 2041.


Years of expiration	Federal
2021	$	173,475
2022-2029	622,276
2030-2039	836,129
2040	97,244
Total federal and state credit carryforwards	$	1,729,124

The Company expects it will continue to pay minimal taxes in future periods through the continued utilization of net operating loss carryforwards, as it is able to achieve taxable income through its operations.

The Company is no longer subject to U.S. federal tax examinations for tax years before 2017, and with few exceptions, the Company is not subject to examination by state tax authorities for tax years which ended before 2017. Loss carryforwards and credit carryforwards generated or utilized in years earlier than 2017 remain subject to examination and adjustment. During 2012, the 2009 federal tax return was examined by the Internal Revenue Service with no significant findings or adjustments. The Company has no unrecognized tax benefits in 2020, 2019 and 2018.