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Deferred Tax Assets and Liabilities
12 Months Ended
Dec. 31, 2020
Income Tax Disclosure [Abstract]  
Deferred Tax Assets and Liabilities
10.
Deferred Tax Assets and Liabilities 
The provision for income taxes results in effective tax rates which are different than the U.S. federal income tax statutory rate. A reconciliation of the differences for the years ended December 31, 2020 and 2019 was as follows:
 
   
2020
  
2019
 
Expected income tax benefit at federal statutory rate
  $2,727,696  $1,785,829 
Expected income tax benefit at state statutory rates net of federal tax benefit
   792,175   364,820 
Stock based compensation
   (592,048  (231,609
Change in valuation allowances—net
   (2,978,937  (2,176,799
Other—net
   51,114   257,759 
   
 
 
  
 
 
 
Benefit from income taxes
  $—    $—   
   
 
 
  
 
 
 
Effective tax rate
   0  0
 
The Company had a tax net loss for the years ended December 31, 2020 and 2019, and therefore expects no assessment of income taxes for such periods. Additionally, the net deferred tax assets are fully allowed for. Accordingly, there was no provision for, or benefit from, income taxes reported for the years ended December 31, 2020 and 2019. The Company’s deferred tax assets and liabilities consisted of the following as of December 31, 2020 and 2019:
 
   
December 31,
   
December 31,
 
   
2020
   
2019
 
Noncurrent deferred tax assets:
          
Federal net operating loss carryforwards
  $5,332,738   $3,470,371 
State net operating loss carryforwards
   2,112,119    1,285,488 
Federal depreciation and amortization
   458,203    53,525 
State depreciation and amortization
   213,359    —   
Accrued—PTO
   75,702    —   
Other
   106,526    —   
   
 
 
   
 
 
 
Total noncurrent deferred tax assets
   8,298,647    4,809,384 
Noncurrent deferred tax liabilities:
          
Federal depreciation and amortization
  $—     $179,720 
State depreciation and amortization
   —      45,490 
Deferred rent asset
   735,537    —   
   
 
 
   
 
 
 
Total noncurrent deferred tax liabilities
   735,537    225,210 
Net noncurrent deferred tax assets
  $7,563,110   $4,584,174 
Valuation allowance
   (7,563,110   (4,584,174
   
 
 
   
 
 
 
Total net noncurrent deferred tax assets
  $—     $—   
   
 
 
   
 
 
 
The Company assesses its deferred tax assets and liabilities to determine if it is more likely than not they will be realized; if not, a valuation allowance is required to be recorded. Based on this guidance, the Company provided a valuation allowance for the full amount. The net increase in the valuation allowance for deferred tax assets and liabilities for the years ended December 31, 2020 and 2019 was $2,978,937 and $2,176,799, respectively. This valuation allowance included the estimated tax liability of $2,983 related to the unrealized gain on investment securities
available-for-sale
as of December 31, 2020. As of December 31, 2020 and 2019, the Company had U.S. federal net operating losses (“NOLs”) totaling approximately $27,528,486 and $17,117,760, respectively. The Company had federal NOLs as of December 31, 2020 and 2019 totaling approximately $1,868,077 from 2017 and prior years that can be carried forward for 20 years, which begin to expire in 2036. As of December 31, 2020 and 2019 the Company had federal NOLs totaling approximately $25,660,409 and $15,249,683, respectively
,
from 2018 through 2020 that can be carried forward indefinitely.
GAAP requires management to evaluate and report information regarding its exposure to various tax positions taken by the Company. The Company has determined whether there are any tax positions that have met the recognition threshold and has measured the Company’s exposure to those tax positions. Management believes that the Company has adequately addressed all relevant tax positions and that there are no unrecorded tax liabilities.
The Company files income tax returns in the U.S. federal jurisdiction and various state jurisdictions. U.S. and state jurisdictions have statutes of limitations that generally range from three to five years.