5. Income Taxes

The provision for (benefit from) income taxes consists of the following:


	2020		2019		2018
Current:
Federal	$	84,420	$	—	$	—
State		23,093		10,676		9,938
Less net operating loss carryforward applied		(98,996)		—		—
Total current		8,517		10,676		9,938

Deferred:
Federal		(182,517)		(451,591)		424,038
State		4,405		(65,877)		91,789
Valuation Allowance		39,236		536,240		(352,727)
Total deferred		(138,876)		18,772		163,100
Provision (benefit)	$	(130,359)	$	29,448	$	173,038

A reconciliation of income taxes, with the amounts computed at the statutory federal rate is as follows:


	2020		2019		2018

Computed tax at federal statutory rate	$	(662,125)	$	(436,850)	$	(555,261)
State income taxes, net of federal tax (benefit) provision		(17,475)		(61,974)		(54,471)
Non deductible expenses		506,798		7,699		9,775
Federal research credit		(31,076)		(22,906)		(16,880)
Net operating loss carryforward adjustment		—		—		131,244
State NOLs		30,397		6,772		(39,979)
Stock Options - Expired		3,763		2,536		4,424
Changes resulting from the TCJA		—		—		1,080,362
Other, net		123		(2,069)		(33,449)
Valuation Allowance		39,236		536,240		(352,727)
Total	$	(130,359)	$	29,448	$	173,038

On December 22, 2017, President Trump signed into law tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “TCJA”), which became effective on that date. The TCJA significantly revised U.S. tax law by lowering the U.S. federal statutory income tax rate from 35% to 21% effective January 1, 2018.

ASC Topic 740, requires the effects of changes in tax laws to be recognized in the period in which the legislation is enacted. Accordingly, in the second quarter of fiscal 2018, the Company recorded a one-time charge of $136,386 within its income tax provision in connection with the TCJA. The net expense of $136,386 relates to revaluation of the Company’s valuation allowance.

The deferred tax assets and deferred tax liabilities recorded on the balance sheet as of June 30, 2020 and 2019 are as follows:


	2020		2019

Deferred tax assets
Bad debts	$	25,500	$	25,500
Intangible assets		1,340		1,935
Accrued liabilities		491,605		262,970
Stock options		25,276		28,568
Net operating loss and credit carryforwards		3,807,811		3,914,655
Total Assets		4,351,532		4,233,628

Deferred tax liabilities
Prepaid expenses		10,587		10,937
Inventory		614,184		652,251
Depreciation		194,920		233,142
Other		116,007		99,575
Total Liabilities		935,698		995,905
Valuation Allowance		(2,775,069)		(2,735,832)
Total deferred taxes	$	640,765	$	501,891

At June 30, 2020, there were $13.2 million dollars of federal net operating loss carryforwards which will expire in 2031 through 2038 and $1.5 million subject to indefinite carryforward. In addition, the Company has state tax net operating losses of approximately $8.1 million that expire in varying years from 2020 through 2039.

The Company files a federal and multiple state income tax returns. With few exceptions the Company’s federal and state income tax returns are open for fiscal years ending after June 30, 2017.

The Company has not taken any uncertain tax positions on its federal or state income tax filings for open tax years.