Note 16 - Income Taxes

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

NOTE 16: INCOME TAXES

A reconciliation of income tax expense and the amount computed by applying the statutory federal income tax rate to the income before provision for income taxes is as follows:

	December 31, 2014			December 31, 2013
Federal statutory rate applied to (loss) before income taxes	$	(1,685,418	)	$	(1,154,195	)
Increase/(decrease) in income taxes results from:
Current tax expense/(benefit)		(19,537	)		94,122
Non deductible expenses		198,295			296,783
Change in deferred assets		64,449			71,274
Change in valuation allowance		1,422,674			786,138
Income tax expense/(benefit)	$	(19,537	)	$	94,122

The components of income tax expense (benefit) for the years ended:

	December 31, 2014			December 31, 2013
Current tax expense/(benefit):	$	(19,537	)	$	94,122
Deferred tax expense/(benefit):
Bad debt allowance		(45,407	)		7,100
Operating loss carryforward		(1,441,716	)		(864,512	)
Amortization of intangibles		5,482			-0-
Patent litigation settlement		58,967			71,274
		(1,442,211	)		(692,016	)
Valuation allowance		1,422,674			786,138
Total tax expense/(benefit)	$	(19,537	)	$	94,122

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assets and liabilities are as follows:

	December 31, 2014			December 31, 2013
Amortization of intangibles	$	278,216		$	283,698
Bad debt allowance		69,022			23,615
Patent litigation liability accrual		256,441			315,408
Operating loss carryforwards		19,662,198			18,220,482
Gross deferred tax assets		20,265,877			18,843,203
Valuation allowance		(20,265,877	)		(18,843,203	)
Net deferred tax liability/(asset)	$	-0-		$	-0-

The Company has net operating loss carry forwards (NOL) for income tax purposes of approximately $54,497,491.  This loss is allowed to be offset against future income until the year 2034 when the NOL’s will expire.  Other timing differences relate to depreciation and amortization for the stock acquisition of Education Navigator in 1998.  The tax benefits relating to all timing differences have been fully reserved for in the valuation allowance account due to the substantial losses incurred through December 31, 2014.  The change in the valuation allowance for the year ended December 31, 2014 was an increase of $1,422,676. The Company's tax returns for the prior three years remain subject to examination by major tax jurisdictions.