Income Taxes

12 Months Ended

Dec. 31, 2020

Income Taxes

Note 10. Income Taxes

Note 10: Income Taxes

Income taxes for years ended December 31, is summarized as follows:

	Year Ended
	December 31,
	2020			2019
Current Provision
Federal	$	(1,557,344	)	$	-
State		(8,068	)		25,236
Foreign		59,447			4,113
Current Income Tax Provision	$	(1,505,965	)	$	29,349
Deferred Provision
Federal	$	-		$	-
State		-			-
Foreign		-			-
Deferred Income Tax Provision		-			-
Total Income Tax Provision	$	(1,505,965	)	$	29,349

The following is a summary of the components of the Company’s deferred tax assets:

	As of December 31,
	2020			2019
Deferred tax assets:
Stock-based compensation		347,865			274,364
Depreciation		(36,470	)		(63,980	)
Intangibles		723,031			590,427
NOL		7,628,443			5,893,260
Accruals & Reserves		259,893			267,980
Net deferred tax Valuation allowance		(8,922,762	)		(6,962,051	)
Net deferred tax assets (liabilities)		-			-

In making our assessment of deferred tax asset recoverability, we considered our historical financial results, our projected future financial results, the planned reversal of existing deferred tax liabilities and the impact of any tax planning actions. Based on our analysis we noted both positive and negative factors relative to our ability to support realization of certain deferred tax assets. However, based on the weighting of all the evidence, including the near-term effect on our income projections of investments we are making in our team, product and systems infrastructure, we concluded that it was more likely than not that the majority of our deferred tax assets related to temporary differences and net operating losses may not be recovered. The establishment of a valuation allowance has no effect on our ability to use the underlying deferred tax assets prior to expiration to reduce cash tax payments in the future to the extent that we generate taxable income.

The Company accrued $60,639 and $0 as of December 31, 2020 and December 31, 2019, respectively, for the liability for unrecognized tax benefits. The Company anticipates the unrecognized tax benefits will be recognized in the next twelve months.

The following table summarizes the Company’s unrecognized tax benefits at December 31, 2020 and December 31, 2019, respectively:

	As of December 31,
	2020		2019
Beginning of year	$	-	$	-
Increase due to current year tax positions		-		-
Increase due to prior year tax positions		60,639		-
Settlements		-		-
Decrease due to lapses		-		-
End of year	$	60,639	$	-