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8. INCOME TAXES | 12 Months Ended
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Mar. 31, 2021
Income Tax Disclosure [Abstract] |
INCOME TAXES | 8. INCOME TAXES For the years ended March 31, 2021 and 2020, we had no income tax expense due to our net operating losses and 100% deferred tax asset valuation allowance. At March 31, 2021 and 2020, we had net deferred tax assets as detailed below. These deferred tax assets are primarily composed of capitalized research and development costs and tax net operating loss carryforwards. Due to uncertainties surrounding our ability to generate future taxable income to realize these assets, a 100% valuation allowance has been established to offset the net deferred tax assets. Significant components of our net deferred tax assets at March 31, 2021 and 2020 are shown below:
|  | YEAR ENDED MARCH 31, |
|  | 2021 |  |  | 2020 |
Deferred tax assets: |  |  |  |  |  |  |  |
Capitalized research and development |  | $ | 3,442,000 |  |  | $ | 3,442,000 |
Net operating loss carryforwards1 |  |  | 19,921,000 |  |  |  | 18,384,000 |
Stock compensation |  |  | 1,399,000 |  |  |  | 1,181,000 |
Total deferred tax assets |  |  | 24,762,000 |  |  |  | 23,007,000 |
Total deferred tax liabilities |  |  | – |  |  |  | – |
Net deferred tax assets |  |  | 24,762,000 |  |  |  | 23,007,000 |
Valuation allowance for deferred tax assets |  |  | (24,762,000 | ) |  |  | (23,007,000 | )
Net deferred tax assets |  | $ | – |  |  | $ | – |
At March 31, 2021, we had tax net operating loss carryforwards for federal and state purposes approximating $77 million and $60 million, portions of which began to expire in the year 2021. The provision for income taxes on earnings subject to income taxes differs from the statutory federal rate for the years ended March 31, 2021 and 2020 due to the following:
|  | 2021 |  |  | 2020 |
Income taxes (benefit) at federal statutory rate of 21.00% |  | $ | (1,657,000 | ) |  | $ | (1,340,000 | )
State income tax, net of federal benefit |  |  | (551,000 | ) |  |  | (446,000 | )
Tax effect on non-deductible expenses and credits |  |  | 1,000 |  |  |  | 122,000 |
True up items |  |  | 25,000 |  |  |  | 42,000 |
Expiration of net operating loss carryforwards |  |  | 427,000 |  |  |  | 222,000 |
Change in valuation allowance |  |  | 1,755,000 |  |  |  | 1,400,000 |
|  | $ | – |  |  | $ | – |
______________ (1) Pursuant to Internal Revenue Code Section 382, use of our tax net operating loss carryforwards may be limited. ASC 740, “Income Taxes”, clarifies the accounting for uncertainty in income taxes recognized in an entity's financial statements, and prescribes recognition thresholds and measurement attributes for financial statement disclosure of tax positions taken or expected to be taken on a tax return. Under ASC 740, the impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. Additionally, ASC 740 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Our practice is to recognize interest and/or penalties related to income tax matters in income tax expense. During the years ended March 31, 2021 and 2020, we did not recognize any interest or penalties relating to tax matters. At and for the years ended March 31, 2021 and 2020, management does not believe the Company has any uncertain tax positions. Accordingly, there are no unrecognized tax benefits at March 31, 2021 or March 31, 2020. Our tax returns remain open for examination by the applicable authorities, generally 3 years for federal and 4 years for state. We are currently not under examination by any taxing authorities.

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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 -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://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 http://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 http://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 http://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 http://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 http://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 http://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 http://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 http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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