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INCOME TAXES | 12 Months Ended
--- | ---
Dec. 31, 2023
Income Tax Disclosure [Abstract] |
INCOME TAXES | NOTE 9 - INCOME TAXES The Company identified its federal and New York tax returns as its “major” tax jurisdictions. The Company is no longer subject to income tax income examinations by these tax authorities for taxable years ended December 31, 2018, and prior. The Company reviewed the prior New York state income tax filings and concluded that the prior year return will be amended to change the apportionment from zero to 100%. The Company believes its income tax filing positions and deductions will be sustained on audit, and it does not anticipate any adjustments that would result in a material change to its financial position. Therefore, no liabilities for uncertain tax positions have been recorded. At December 31, 2023, the Company had approximately $63,500,000 and $13,600,000, respectively, of federal and state net operating losses that may be available to offset future taxable income. As a result of the Tax Cuts and Jobs Act of 2017 (the “Tax Act”), certain future carryforwards do not expire. At December 31, 2023, approximately $7,800,000 of federal net operating losses will expire from 2030 to 2038 and approximately $55,700,000 have no expiration but are subject to a utilization limit equal to 80% of current taxable income. In accordance with Section 382 of the Internal Revenue Code, the usage of the Company’s net operating loss carryforwards are subject to annual limitations due to several greater than 50% ownership changes. The Section 382 limitations resulted in approximately $28,200,000 of federal NOLs not being realizable as of December 31, 2023, and 2022 and the cumulative reversal of approximately $9,600,000 of net operating loss deferred tax assets. The Company has not performed a formal analysis for the year ended December 31, 2023, but it believes its ability to use such net operating losses and tax credit carryforwards in the future is subject to annual limitations due to change of control provisions under Sections 382 and 383 of the Internal Revenue Code, which will significantly impact its ability to realize these deferred tax assets. Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three-year period ended December 31, 2023. For the period ended December 31, 2023, the Company has recorded a full valuation allowance recorded against the gross deferred tax asset balance as management believes that it is more likely than not that the results of operations will not generate sufficient taxable income to realize any of the deferred tax assets. As of the date of this filing, the Company has not filed its 2023 federal and state corporate income tax returns. The Company expects to file these documents as soon as practicable. The Company’s net deferred tax assets, liabilities and valuation allowance as of December 31, 2023 and 2022 are summarized as follows: SCHEDULE OF NET DEFERRED TAX ASSETS AND LIABILITIES
|  | 2023 |  |  | 2022 |
|  | December 31, |
|  | 2023 |  |  | 2022 |
Deferred Tax Assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 14,311,000 |  |  | $ | 13,200,000 |
Stock-based compensation |  |  | 15,788,000 |  |  |  | 13,810,000 |
Research and development costs |  |  | 1,676,000 |  |  |  | 655,000 |
Research and development credits |  |  | 330,000 |  |  |  | 330,000 |
Right-of-use assets |  |  | 25,000 |  |  |  | - |
Other |  |  | 4,000 |  |  |  | - |
Total Deferred Tax Assets |  |  | 32,134,000 |  |  |  | 27,995,000 |
Deferred Tax Liabilities: |  |  |  |  |  |  |  |
Depreciation |  |  | (122,000 | ) |  |  | (106,000 | )
Intangible assets |  |  | (47,000 | ) |  |  | (113,000 | )
Lease liability |  |  | (39,000 | ) |  |  | - |
Other |  |  | (86,000 | ) |  |  | - |
Total Deferred Tax Liabilities |  |  | (294,000 | ) |  |  | (219,000 | )
Net Deferred Tax Asset |  |  | 31,840,000 |  |  |  | 27,776,000 |
Less: valuation allowance |  |  | (31,840,000 | ) |  |  | (27,776,000 | )
Deferred Tax Asset, Net of Valuation Allowance |  | $ | - |  |  | $ | - |
Change in valuation allowance |  | $ | (4,064,000 | ) |  | $ | (5,822,000 | )
The income tax provision (benefit) as of December 31, 2023 and 2022 consists of the following: SCHEDULE OF INCOME TAX PROVISION (BENEFIT)
|  | 2023 |  |  | 2022 |
|  | December 31, |
|  | 2023 |  |  | 2022 |
|  | (As Restated) |  |  | (As Restated) |
Federal: |  |  |  |  |  |  |  |
Current |  | $ | - |  |  | $ | - |
Deferred |  |  | (3,090,000 | ) |  |  | (4,351,000 | )
State & Local: |  |  |  |  |  |  |  |
Current |  |  | - |  |  |  | - |
Deferred |  |  | (974,000 | ) |  |  | (1,471,000 | )
Income tax provision (benefit), gross |  |  | (4,064,000 | ) |  |  | (5,822,000 | )
Change in valuation allowance |  |  | 4,064,000 |  |  |  | 5,822,000 |
Income tax provision (benefit) |  | $ | - |  |  | $ | - |
A reconciliation of the statutory federal income tax benefit to actual tax benefit for the years ended December 31, 2023 and 2022 is as follows: SCHEDULE OF STATUTORY FEDERAL INCOME TAX RATE
|  | December 31, |
|  | 2023 |  |  | 2022 |
|  | (As Restated) |  |  | (As Restated) |
Federal statutory rate |  |  | 21.0 | % |  |  | 21.0 | %
State rate, net of federal benefit |  |  | 1.7 | % |  |  | 7.8 | %
Permanent differences |  |  | 7.2 | % |  |  | 7.8 | %
Tax return to provision adjustment |  |  | -0.2 | % |  |  | 7.3 | %
Change in valuation allowance |  |  | -29.7 | % |  |  | -44.0 | %
Effective tax rate |  |  | 0.0 | % |  |  | 0.0 | %

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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 -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
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