INCOME TAXES

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 13 - INCOME TAXES

Income tax expense differs from the statutory amounts for each of the following years:

	For the years ended December 31,
	2021			2020
Income taxes at U.S. statutory rate	$	(17,836,000	)	$	(17,689,000	)
Current year reserve		12,539,000			12,020,000
Expenses not deductible		5,297,000			5,669,000
Total tax expense	$	-		$	-

Deferred taxes are provided for the temporary differences between the financial reporting bases and the tax bases of our assets and liabilities. The temporary differences that give rise to deferred tax assets and liabilities were as follows:

	December 31, 2021			December 31, 2020
Deferred tax assets (liabilities):
Net operating loss carryforwards	$	71,001,000		$	61,062,000
General business credit carryforwards		4,741,000			4,398,000
State credits		2,780,000			2,857,000
Property, equipment and goodwill		200,000			8,000
Stock options		10,537,000			9,551,000
Deferred revenue		62,000			62,000
Intangible assets		367,000			312,000
Other		16,000			70,000
Gross deferred tax assets		89,704,000			78,320,000
Valuation allowance		(89,704,000	)		(78,320,000	)
Net deferred taxes	$	-		$	-

As of December 31, 2021, we had approximately $338.1 million of net operating loss carryforwards and approximately $4.7 million of general business credit carryforwards. These carryforwards expire as follows:

	Net operating loss carryforwards		General business credit carryforwards
2022	$	8,230,000	$	431,000
2023		5,434,000		362,000
2024		8,711,000		287,000
2025		2,370,000		182,000
2026		7,160,000		72,000
Thereafter		90,416,000		3,407,000
	$	122,321,000	$	4,741,000

As of December 31, 2021, we had approximately $215.8 million of net operating loss carryforwards that do not expire and can be carried forward indefinitely. Such net operating loss carryforwards can only be used to offset 80% of taxable income in any given tax year. In addition, our net operating loss carryforwards may be subject to limitation due to ownership changes.

We acquired MacroChem Corporation on March 25, 2009 and Somanta Pharmaceuticals, Inc. on January 4, 2008. Both of these corporations were loss-making entities at the time of acquisition. As a result, the net operating losses related to those acquisitions may be subject to annual limitations.