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INCOME TAXES | 12 Months Ended
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Dec. 31, 2021
Income Tax Disclosure [Abstract] |
INCOME TAXES | NOTE 10 – INCOME TAXES The Company’s U.S. and foreign loss before income taxes are set forth below: SCHEDULE OF EARNING (LOSS) BEFORE INCOME TAX
|  | 2021 |  |  | 2020 |
|  | December 31, |
|  | 2021 |  |  | 2020 |
United States |  | $ | (15,420,364 | ) |  | $ | — |
Foreign |  |  | (41,011,337 | ) |  |  | (6,864,676 | )
Total |  | $ | (56,431,701 | ) |  | $ | (6,864,676 | )
For the year ended December 31, 2021, the Company recorded an income tax benefit of $7,454,805. For the year ended December 31, 2020, the Company had no income tax expense or benefit. The income tax benefit is as follows: SCHEDULE OF INCOME TAX EXPENSE BENEFITS
|  | 2021 |  |  | 2020 |
|  | December 31, |
|  | 2021 |  |  | 2020 |
Deferred tax benefit – United States |  | $ | — |  |  | $ | — |
Deferred tax benefit – Foreign |  |  | 7,454,805 |  |  |  | — |
Total income tax benefit |  | $ | 7,454,805 |  |  | $ | — |
The Company’s deferred tax assets and deferred tax liabilities consist of the following: SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES
|  | 2021 |  |  | 2020 |
|  | December 31, |
|  | 2021 |  |  | 2020 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 5,509,522 |  |  | $ | 1,340,152 |
Stock-based compensation |  |  | 858,791 |  |  |  | — |
Accrued bonus |  |  | 121,051 |  |  |  | — |
Intangible amortization |  |  | 23,204 |  |  |  | — |
Other |  |  | 35,456 |  |  |  | — |
Less valuation allowances |  |  | (6,548,024 | ) |  |  | (1,340,152 | )
Total deferred tax assets |  | $ | — |  |  | $ | — |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Indefinite lived intangible assets |  |  | (1,607,122 | ) |  |  | — |
Net deferred tax liabilities |  | $ | (1,607,122 | ) |  | $ | — |
The Company had the following potentially utilizable net operating loss tax carryforwards: SCHEDULE OF OPERATING LOSS CARRY FORWARDS
|  | 2021 |  |  | 2020 |
|  | December 31, |
|  | 2021 |  |  | 2020 |
Federal |  | $ | 9,411,533 |  |  | $ | — |
State |  | $ | 8,664,242 |  |  | $ | — |
Foreign |  | $ | 11,911,845 |  |  | $ | 5,057,176 |
The Tax Cuts and Jobs Act of 2017 (the “Act”) limits the net operating loss deduction to 80% of taxable income for losses arising in tax years beginning after December 31, 2017. However, the net operating losses now have an indefinite carryforward as opposed to the former 20-year carryforward. As of December 31, 2021, the Company had federal net operating loss carryforwards of $9,411,533 which can be carried forward indefinitely. In addition, the Company has state net operating loss carryforwards of $8,664,242 which can be carried forward indefinitely and Canadian net operating loss carryforwards of $11,911,845 which will begin to expire in 2030. The Company’s effective tax rate varied from the statutory rate as follows: SCHEDULE OF EFFECTIVE STATUTORY INCOME TAX RATE
|  | December 31, |
|  | 2021 |  |  | 2020 |
Federal income tax at the statutory rate |  |  | (21.0 | )% |  |  | (21.0 | )%
State income tax rate (net of federal) |  |  | (1.0 | )% |  |  | —% |
Foreign tax rate differential |  |  | (4.0 | )% |  |  | (5.5 | )%
Intangible asset impairment |  |  | 4.3 | % |  |  | —% |
Non-deductible expenses |  |  | 1.4 | % |  |  | 7.4 | %
Change in valuation allowance |  |  | 7.0 | % |  |  | 19.1 | %
Effective income tax rate |  |  | (13.3 | )% |  |  | — | %
On September 16, 2021, the Company acquired MagicMed. In connection with the acquisition, the Company recorded intangible assets from IPR&D valued at $35,500,000, which would be tested for impairment for book purposes, but without a tax basis, creating a deferred tax liability of $9,061,927. The deferred tax liability decreased to $1,607,122 due to an impairment on intangible asset of $29,048,164 and an impairment of goodwill of $8,225,862 for the year ended December 31, 2021. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The valuation allowance increased by $5,207,872 and $1,340,152 during the years ended December 31, 2021 and 2020, respectively. The Company files U.S. federal and state returns. The Company’s foreign subsidiary also files a local tax return in their local jurisdiction. From a U.S. federal, state and Canadian perspective the years that remains open to examination are consistent with each jurisdiction’s statute of limitations.

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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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