Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

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INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
SCHEDULE OF PRETAX INCOME FROM CONTINUING OPERATIONS

 

    2021     2020  
                         
Federal income tax expense (benefit) at the statutory rate     (21.0 )%   $ (2,762,295 )     (21.0 )%   $ (2,229,606 )
State income taxes, net of federal tax expense     57.7 %     7,593,773       (7.0 )%     (745,190 )
Executive Compensation Deduction Limitation     229.7 %     30,213,175       4.2 %     444,031  
Excess Tax Benefit Related to Share-Based Compensation     (14.5 )%     (1,909,197 )     0.0 %     -   
Nondeductible Other Expenses     1.7 %     225,278       0.0 %     -   
Change in Valuation Allowance     (110.1 )%     (14,477,083 )     23.9 %     2,533,165  
Change in Expected Utilization of Tax Attributes     32.5 %     4,281,445       0.0 %     -   
Other, net     (1.1 )%     (144,375 )     0.0 %     -   
Income tax expense (benefit) from continuing operations     174.9 %   $ 23,020,721       0.1 %   $ 2,400  

SCHEDULE OF PROVISION FOR INCOME TAXES

The components of the provision for income taxes are as follows:

 

    2021     2020  
Current income tax expense (benefit)                
Federal     -          
State   $ 1,600     $ 2,400  
Total Current Income Tax Expense     1,600       2,400  
                 
Deferred expense                
Federal     29,904,031       -  
State     7,592,173       -  
Total Deferred Tax Expense     37,496,204       9,079,841  
                 
Change in Valuation Allowance     (14,477,083 )     (9,079,841 )
                 
Net Deferred Tax Expense after Valuation Allowance     23,019,121       (0 )
                 
Income Tax Provision   $ 23,020,721     $ 2,400  

SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2021 and 2020 are presented below.

 

    12/31/2021     12/31/2020  
Deferred tax assets:                
Tax Credit carryforwards   $ 163,211     $ 31,961  
Net Operating Loss carryforwards     25,422,829       11,467,248  
Capital Loss carryforwards     -       758,731  
Intangible assets     1,055,099       2,995,317  
Stock Compensation     447,487       246,975  
Accruals, reserves and other     269,096       143,079  
Digital Currencies     7,255,674       -  
Other     -       144,358  
Total gross deferred tax assets     34,613,396       15,787,669  
                 
Less Valuation Allowance     -     (14,477,083 )
                 
Net deferred tax assets     34,613,396       1,310,586  
                 
Deferred tax liabilities:                
      -       -  
Unrealized Gains     (18,294,723 )     -  
Prepaid service contracts     (4,395,095 )        
Property and equipment     (34,942,699 )     (1,310,586 )
Total gross deferred liabilities     (57,632,517 )     (1,310,586 )
Net deferred tax liability   $ (23,019,121 )   $ -  
SCHEDULE OF NET OPERATING LOSS CARRYFORWARDS

SCHEDULE OF NET OPERATING LOSS CARRYFORWARDS  

    Gross Amount     Expiring
           
Federal Net Operating Loss Carryforwards     3,314,298     2034-2035
Federal Net Operating Loss Carryforwards - Indefinite Life     105,815,972     Indefinite
State Net Operating Loss carryforwards     54,106,348     2035-2041
SCHEDULE OF ATTRIBUTES AND CREDIT CARRYFORWARDS

In addition, the Company has the following attributes and credit carryforwards as follows:

SCHEDULE OF ATTRIBUTES AND CREDIT CARRYFORWARDS

Federal R&D Tax Credit Carryforwards     131,250     2040-2041
State alternative minimum tax credit carryforwards     40,457      
SCHEDULE OF UNRECOGNIZED TAX BENEFITS ROLL FORWARD

A reconciliation of the beginning and ending amount of total unrecognized tax benefits for the tax years ended December 31, 2021, and 2020 is as follows:

 

    2021     2020  
             
Balance, beginning of year   $ -     $        -  
Increase related to prior year tax positions     25,000       -  
Decrease related to prior year tax positions     -       -  
Increase related to current year tax positions     18,750       -  
Settlements     -       -  
Lapse of statute of limitation     -       -  
Change in tax rate     -       -  
                 
Balance, end of year   $ 43,750     $ -