XML 32 R20.htm IDEA: XBRL DOCUMENT
v3.23.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2022
Income Tax Disclosure [Abstract] |
INCOME TAXES | Note 14. INCOME TAXES The provision for income taxes for the years ended December 31, 2022 and 2021, is set forth below:
Current and Deferred |  |  | Year Ended December 31, 2022 |  |  |  | Year Ended December 31, 2021 |
Federal |  | $ | - |  |  | $ | - |
States |  |  | - |  |  |  | - |
Total Provision for Income Taxes |  | $ | - |  |  | $ | - |
The following is a reconciliation of our income tax rate computed using the federal statutory rate to our actual income tax rate for the years ended December 31, 2022 and 2021 is set forth below:
|  | Year Ended December 31, 2022 |  |  | Year Ended December 31, 2021 As Revised |
U.S. statutory income tax rate |  |  | 21.0 | % |  |  | 21.0 | %
State taxes, net of federal benefit |  |  | 4.1 | % |  |  | 4.1 | %
Permanent difference, overaccruals, and non-deductible items |  |  | (6.9 | )% |  |  | 6.3 | %
Change in state rate |  |  | 0.7 | % |  |  | 8.3 | %
Deferred tax valuation allowance |  |  | (18.4 | )% |  |  | (38.7 | )%
Other |  |  | (.5 | )% |  |  | (1.0 | )%
Total |  |  | 0.00 | % |  |  | 0.00 | %
The components of net deferred tax assets at December 31, are set forth below:
|  |  |  |  | December 31, |
|  | December 31, 2022 |  |  | 2021 As Revised |
Deferred tax assets: |  |  |  |  |  |
Current: |  |  |  |  |  |
Net operating loss |  | $ | 5,075,000 |  |  | $ | 4,959,000 |
Allowance for doubtful accounts |  |  | 71,000 |  |  |  | 149,000 |
Inventory - IRC 263A adjustment |  |  | 411,000 |  |  |  | 377,000 |
Stock based compensation - options and restricted stock |  |  | 183,000 |  |  |  | 183,000 |
Capitalized engineering costs |  |  | 331,000 |  |  |  | 430,000 |
Amortization - NTW Transaction |  |  | 359,000 |  |  |  | 445,000 |
Inventory reserve |  |  | 932,000 |  |  |  | 790,000 |
Deferred gain on sale of real estate |  |  | 36,000 |  |  |  | 45,000 |
Accrued expenses |  |  | 30,000 |  |  |  | 18,000 |
Disallowed interest |  |  | 1,663,000 |  |  |  | 1,576,000 |
Operating lease liabilities |  |  | 814,000 |  |  |  | 984,000 |
Total deferred tax asset before valuation allowance |  |  | 9,905,000 |  |  |  | 9,956,000 |
Valuation allowance |  |  | (7,701,000 | ) |  |  | (7,503,000 | )
Total deferred tax asset after valuation allowance |  |  | 2,204,000 |  |  |  | 2,453,000 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Property and equipment |  |  | (1,583,000 | ) |  |  | (1,697,000 | )
Operating Lease ROU assets |  |  | (621,000 | ) |  |  | (756,000 | )
Total deferred tax liabilities |  |  | (2,204,000 | ) |  |  | (2,453,000 | )
Net deferred tax asset |  | $ | - |  |  | $ | - |
During the year ended December 31, 2022, the Company determined that certain attributes of Deferred Tax Assets and Liabilities were incorrect for December 31, 2021 and 2020. See Note 16 for further information. During the years ended December 31, 2022 and 2021, the Company recorded a valuation allowance equal to its net deferred tax assets. The Company determined that due to a recent history of net losses, at this time sufficient uncertainty exists regarding the future realization of these deferred tax assets through future taxable income. If, in the future, the Company believes that it is more likely than not that these deferred tax benefits will be realized, the valuation allowances will be reduced or eliminated. With a full valuation allowance, any change in the deferred tax asset or liability is fully offset by a corresponding change in the valuation allowance. At December 31, 2022 and 2021, the Company provided a valuation allowance on its net deferred tax assets of $7,701,000 and $7,503,000, respectively. As of December 31, 2022, the Company had a Federal net operating loss carry forward of approximately $22,420,000, of which approximately $12,220,000 expires from 2023 through 2037 and $10,200,000 does not expire. In addition, the Company has net operating loss carry forwards from various states of approximately $22,600,000 which expire from 2035 through 2042. At December 31, 2022 and 2021, the Company had no material unrecognized tax benefits and no adjustments to liabilities or operations were required. The Company does not expect that its unrecognized tax benefits will materially increase within the next twelve months. The Company recognizes interest and penalties related to uncertain tax positions in interest expense. As of December 31, 2022, and 2021, the Company has not recorded any provisions for accrued interest and penalties related to uncertain tax positions. In certain cases, the Company’s uncertain tax positions are related to tax years that remain subject to examination by the relevant tax authorities. The Company files federal and state income tax returns in jurisdictions with varying statutes of limitations. The 2019 through 2022 tax years generally remain subject to examination by federal and state tax authorities. In August 2022, the Inflation Reduction Act of 2022, (the “IRA”), was signed into law which includes a stock buyback excise tax of 1% on share repurchases, which will apply to net stock buybacks after December 31, 2022. We do not expect this to have a material impact if and when share repurchases occur.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 https://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 https://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 https://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 https://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 https://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 https://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 https://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 https://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 https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration