INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of components of income tax expense (benefit)

The components of income tax (benefit) expense for the years ended December 31, 2020 and 2019 are as follows:


	December 31, 2020		December 31, 2019
Current federal tax (expense)/benefit	$	(69,000)	$	(68,606)
Deferred federal tax (expense)/benefit	69,000		68,606
Total federal tax (expense)/benefit	$	—	$	—

Schedule of effective income tax rate reconciliation

Reconciliation between the amount determined by applying the U.S. federal income tax rate of 21% to pretax income from continuing operations and income tax expense presented in the accompanying consolidated statements of operations was as follows for the years ended December 31, 2020 and 2019:


	December 31, 2020		December 31, 2019
Statutory tax on book income	$	(2,393,000)	$	(1,152,000)
Permanent differences	7,000		139,000
Change in derivative liability	(344,000)		102,000
Tensile transaction gain	1,745,000		210,000
Change in valuation allowance	904,000		1,344,000

Prior year return true up	81,000		(643,000)
Income tax expense (benefit)	$	—	$	—

Schedule of deferred tax assets and liabilities

The tax effect of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2020 and 2019 are presented below:


	December 31, 2020		December 31, 2019
Deferred tax assets:
Alternative minimum tax credits	$	—	$	69,000
Accrued bonus and stock based compensation	403,000		386,000
Basis of intangible assets	1,406,000		1,687,000
Bad debt reserve	120,000		85,000
Contribution carryover	41,000		38,000
Interest expense carryforward	—		487,000
Net operating loss carry forwards	15,168,000		13,682,000
Less valuation allowance	(14,357,000)		(13,453,000)
Total deferred tax assets	$	2,781,000	$	2,981,000

	December 31, 2020		December 31, 2019
Deferred tax liabilities:


Basis of fixed assets	$	(2,163,000)	$	(2,788,000)
Contingent liability	—		—
Partnership income	(618,000)		(124,000)
Total deferred tax liabilities	$	(2,781,000)	$	(2,912,000)

Net deferred tax assets	$	—	$	69,000