Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2019

The components of the income tax provisions for 2019 and 2018 are as follows:

	2019		2018
Current provision:
Federal	$	-	$	-
State		-		-

Deferred benefit:
Federal		-		-
State		-		-
		-		-
Change in valuation allowance		-		-
Total Provision	$	-	$	-

Schedule of different tax rate

The difference between the income tax provision and income taxes computed using the U. S. federal income tax rate of 21% consisted of the following:

	2019			2018
Provision at statutory rate		21.0	%		21.0	%
State taxes, net of federal benefit		6.98	%		6.98	%
Nondeductible and other items		(0.07	)%		(0.03	)%
Change in valuation allowance		(27.91	)%		(27.95	)%
Total		(0.0	)%		(0.0	)%

Schedule of deferred taxes

Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and amounts used for income tax purposes. Significant components of the Company's deferred taxes as of December 31, 2019 and 2018 are as follows:

	2019			2018
Deferred tax assets:
Allowance for doubtful debt	$	7,598		$	6,926
Stock options issued for services		1,632,377			1,082,303
Net operating loss carryforward		4,766,552			3,126,434
Other		19,516			560
Total deferred tax assets		6,426,043			4,216,223

Deferred tax liabilities:
Royalty obligation		(708,046	)		-
Other		(42,915	)		(229,598	)
Total deferred tax liabilities		(750,961	)		(229,598	)
Deferred tax asset		5,675,082			3,986,625
Valuation allowance		(5,675,082	)		(3,986,625	)