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INCOME TAXES (Tables) | 12 Months Ended
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Dec. 31, 2022
INCOME TAXES |
Income Tax Expense |
The Company’s income tax expense (benefit) consisted of: |  |  |  |  |  |
|  | For the Year Ended |
|  | December 31, |  |  | December 31, |
|  | 2022 |  |  | 2021 |
Current: |  |  |  |  |  |
Federal |  | $ | - |  |  | $ | - |
State |  |  | - |  |  |  | (74,000 | )
Foreign |  |  | - |  |  |  | - |
|  |  | - |  |  |  | (74,000 | )
Deferred: |  |  |  |  |  |  |  |
Federal |  |  | - |  |  |  | - |
State |  |  | - |  |  |  | - |
Foreign |  |  | - |  |  |  | - |
|  |  | - |  |  |  | - |
Total |  | $ | - |  |  | $ | (74,000 | )
Net Income (Loss) Before Income Tax |
The Company’s net income (loss) before income tax consisted of: |  |  |  |  |  |  |  |
|  | For the Year Ended |
|  | December 31, |  |  | December 31, |
|  | 2022 |  |  | 2021 |
United States |  | $ | (2,880,060 | ) |  | $ | (4,509,585 | )
Foreign |  |  | - |  |  |  | - |
Total |  | $ | (2,781,060 | ) |  | $ | (4,509,585 | )
Effective Income Tax Rate Reconciliation |
|  | For the Year Ended |
|  | December 31, |  |  | December 31, |
|  | 2022 |  |  | 2021 |
Income (Loss) before income tax |  | $ | (2,880,060 | ) |  | $ | (4,509,585 | )
US statutory corporate income tax rate |  |  | 28.00 | % |  |  | 28.00 | %
Income tax expense (benefit) computed at US statutory corporate income tax rate |  |  | (806,417 | ) |  |  | (1,002,844 | )
Reconciling items: |  |  |  |  |  |  |  |
Change in valuation allowance on deferred tax assets |  |  | 553,005 |  |  |  | 1,334,294 |
Provision to prior year tax return |  |  | 36,032 |  |  |  | (60,646 | )
Incentive stock options and warrants |  |  | 183,076 |  |  |  | 5,139 |
Gain Upon Debt Extinguishment |  |  |  |  |  |  | (116,083 | )
Other |  |  | 34,034 |  |  |  | 25,894 |
Income tax expense (benefit) |  | $ | - |  |  | $ | (74,086 | )
Deferred Income Tax Assets (Liabilities) |
|  | December 31, |  |  | December 31, |
|  | 2022 |  |  | 2021 |
Deferred tax assets: |  |  |  |  |  |
Reserve for Bad Debt |  | $ | 470,000 |  |  | $ | 470,000 |
Inventory Reserve |  |  | 27,000 |  |  |  | - |
Accrued Vacation |  |  | 38,000 |  |  |  | 81,000 |
Warranty Reserve |  |  | 19,000 |  |  |  | 19,000 |
Intangible Assets |  |  | 257,000 |  |  |  | 404,000 |
Capitalized Research and Development |  |  | 67,000 |  |  |  | - |
Operating lease right-of-use liabilities |  |  | 241,000 |  |  |  | 267,000 |
Net operating losses |  |  | 4,639,000 |  |  |  | 4,124,000 |
Valuation Allowance |  |  | (5,332,000 | ) |  |  | (4,941,000 | )
Deferred Tax Assets |  |  | 426,000 |  |  |  | 424,000 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Operating lease right-of-use assets |  |  | (217,000 | ) |  |  | (277,000 | )
Property and Equipment |  |  | (209,000 | ) |  |  | (147,000 | )
|  |  | (426,000 | ) |  |  | (424,000 | )
Net Deferred Tax Assets and Liabilities |  | $ | - |  |  | $ | - |

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