DEFERRED TAXES

12 Months Ended

Dec. 31, 2016

Deferred Revenue Disclosure [Abstract]

Deferred Revenue Disclosure [Text Block]

NOTE 10.  DEFERRED TAXES

The components of net deferred tax assets (liabilities) are as follows:

		December 31,
		2016		2015
Long-lived assets	$	504,721	$	(117,808)
Equity-based instruments		5,043,533		3,594,015
Net operating loss carryforwards		2,761,830		1,999,309
Deferred tax asset valuation allowance		(8,310,084)		(5,475,516)
	$	–	$	–

A reconciliation of our income tax provision and the amounts computed by applying statutory rates to income before income taxes is as follows:

		Year ended December 31,
		2016		2015
Income tax benefit at statutory rate	$	(11,151,890)	$	(2,987,334)
State income tax benefit, net of Federal benefit		(1,518,625)		(406,805)
Amortization of debt discount		313,871		655,669
Loss (gain) on derivative		8,681,320		(81,368)
Loss on extinguishment of debt		838,379		–
Other		2,377		1,440
Valuation allowance		2,834,568		2,818,398
	$	–	$	–