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Income Tax
 12 Months Ended
Dec. 31, 2025
Income Tax [Abstract]  
INCOME TAX

NOTE 15 – INCOME TAX

 

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

  

Net deferred tax assets consist of the following components as of December 31:

 

   2025   2024 
Deferred Tax Assets:        
NOL Carryover  $11,836,900   $9,602,900 
Allowance for Doubtful Accounts   56,100    56,100 
Depreciation and amortization   3,349,400    4,135,700)
Less valuation allowance   (15,242,400)   (13,794,700)
Net deferred tax assets  $
—
   $
—
 

 

The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pre-tax income from continuing operations for the period ended December 31, due to the following:

 

   For The Years Ended December 31, 
   2025   2024 
Expected federal tax (expense) benefit  $1,234,000    21.0%  $2,357,000    21.0%
Expected state tax (expense) benefit   352,000    6.0%   674,000    6.0%
Stock based compensation   (36,600)   (0.9)%   (109,800)   (1.0)%
NOLs expired   (103,600)   (1.8)%   
-
    
-
%
Nondeductible expenses and other   900    
-
%   (900)   
-
%
Increase in valuation allowance   (1,446,700)   (24.3)%   (2,920,300)   (26.0)%
Total provision for income taxes  $
-
    
-
   $
-
    
-
 

 

At December 31, 2025, the Company had operating loss carry forwards of approximately $43,800,000, of which $2,250,000 expire from 2025 – 2040, and no expiration on the remaining amount. In accordance with Section 382 of the Internal Revenue code, the usage of the Company’s net operating loss carryforwards may be limited in the event of a change in ownership. A full Section 382 analysis has not been prepared and NOLs could be subject to limitation under Section 382.

 

There is a full valuation allowance as of December 31, 2025 and 2024 which may be reversed in future periods at a point when the Company can make the determination that the recoverability will be probable. The valuation allowance for deferred tax assets increased by approximately $1,429,200 and $2,920,300 during the years ended December 31, 2025 and 2024, respectively.

 

The United States Federal and applicable state returns from 2018 forward are still subject to tax examination by the United States Internal Revenue Service; however, the Company does not currently have any ongoing tax examinations.