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INCOME TAXES | 12 Months Ended
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Dec. 31, 2018
Notes to Financial Statements |
NOTE 9 - INCOME TAXES | The reconciliation of income tax expense computed at the U.S. federal statutory rate to the income tax provision for the years ended December 31, 2018 and 2017 is as follows:
|  | 12/31/2018 |  |  | 12/31/2017 |
US |  |  |  |  |  |
Income before income taxes |  | $ | (8,731,677 | ) |  | $ | (6,209,768 | )
Taxes under statutory US tax rates |  | $ | (1,833,652 | ) |  | $ | (2,111,321 | )
Increase (decrease) in taxes resulting from: |  |  |  |  |  |  |  |
Increase (decrease) in valuation allowance |  | $ | 554,452 |  |  | $ | 156,724 |
Foreign tax rate differential |  | $ | 164,394 |  |  | $ | 424,810 |
Tax Cuts and Jobs Act |  | $ | - |  |  | $ | 181,881 |
Permanent differences |  | $ | 1,628,906 |  |  | $ | 1,384,635 |
Purchase price adjustments |  | $ | 25,202 |  |  | $ | - |
Discrete items |  | $ | (318,892 | ) |  | $ | - |
State taxes |  | $ | (146,148 | ) |  | $ | (31,629 | )
Income tax (expense) benefit |  | $ | 74,263 |  |  | $ | 5,100 |
On December 22, 2017, the Tax Cuts and Jobs Act (“The Act”), was signed into law by President Trump. The Act includes a number of provisions, including the lowering of the U.S. corporate tax rate from 35 percent to 21 percent, effective January 1, 2018 and the establishment of a territorial-style system for taxing foreign-source income of domestic multinational corporations. In December 2017, the SEC issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Act (“SAB118”), which allows us to record provisional amounts during a measurement period not to extend beyond one year of the enactment. The Company remeasured its deferred tax assets and liabilities as of December 31, 2017, applying the reduced corporate income tax rate and recorded a provisional decrease to the deferred tax assets of $181,881, with a corresponding adjustment to the valuation allowance. In the fourth quarter of 2018, we completed our analysis to determine the effect of the Tax Act and there were no material adjustments as of December 31, 2018. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and amounts used for income tax purposes. Significant components of the Company's deferred tax assets and liabilities consist of the following:
|  | 12/31/2018 |  |  | 12/31/2017 |
Net Operating Loss Carryforward |  | $ | 904,877 |  |  | $ | 514,338 |
Nonqualified Stock Options |  |  | 187,513 |  |  |  | - |
Depreciation |  |  | 1,602 |  |  |  | - |
Total Deferred tax assets |  |  | 1,093,992 |  |  |  | 514,338 |
Intangibles |  |  | (10,729 | ) |  |  | - |
Goodwill |  |  | (14,473 | ) |  |  | - |
Total Deferred tax liabilities |  |  | (25,202 | ) |  |  | - |
Valuation allowance |  |  | (1,068,790 | ) |  |  | (514,338 | )
Net deferred tax assets (liabilities) |  | $ | - |  |  | $ | - |
At December 31, 2018, the Company had U.S. net operating loss carry forwards of approximately $2,422,876 that may be offset against future taxable income, subject to limitation under IRC Section 382. Of the $2.4 million, of Federal net operating loss carryforwards, $2.2 million begin to expire in 2031. The remaining balance of $.2 million is limited in annual usage of 80% of current year’s taxable income, but do not have an expiration. At December 31, 2018, the Company had Greece net operating loss carry forwards of approximately $847,896 that may be offset against future taxable income which begin to expire in 2019. At December 31, 2018, the Company had United Kingdom net operating loss carry forwards of approximately $847,896 that may be offset against future taxable income part or all of which may not be available to offset our future taxable income in the United Kingdom should there be a change in the nature or conduct of our business in the United Kingdom within the three years subsequent to the date of our acquisition of Decahedron. No tax benefit has been reported in the December 31, 2018 or 2017 consolidated financial statements due to the uncertainty surrounding the realizability of the benefit, based on a more likely than not criteria and in consideration of available positive and negative evidence. The Company applied the "more-likely-than-not" recognition threshold to all tax positions taken or expected to be taken in a tax return, which resulted in no unrecognized tax benefits as of December 31, 2018 and December 31, 2017, respectively.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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