INCOME TAXES

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 8: INCOME TAXES

Income tax expense is comprised of the following:

	Year Ended December 31,
	2023		2022
Federal:
Current	$	–	$	–
Deferred		–		–
Total		–		–
State:
Current		5		–
Deferred		–		–
Total		5		–
Total income tax expense (benefit)	$	5	$	–

Income tax expense (benefit) differs from the amount computed by applying the U.S. statutory income tax rate to loss before income taxes for the reasons set forth below.

	Year Ended December 31,
	2023		2022
Income tax benefit at federal statutory rate		(21.00)%		(21.00)%
State tax expense (benefit), net of federal benefit		0.23 %		(0.01)%
Valuation allowance		20.49 %		21.10 %
Research and development credits		0.45 %		0.04 %
Other permanent differences		0.17 %		(0.14)%
Total effective rate		0.34 %		0.00 %

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as operating loss and tax credit carryforwards. The tax effects of the temporary differences and carry forwards are as follows:

	December 31,
	2023			2022
Deferred tax assets:
Net operating loss carryforwards	$	6,090		$	5,748
Research and development and other credit carryforwards		630			637
Share-based compensation		816			803
Intangible amortization		(12	)		–
Right-of-use operating lease liabilities		1,389			1,550
Other		(5	)		(12	)
Total deferred tax assets		8,908			8,726
Less: valuation allowance		(7,546	)		(7,235	)
Net deferred tax assets	$	1,362		$	1,491
Deferred tax liabilities:
Depreciation on property and equipment	$	(132	)	$	(113	)
Right-of-use operating lease assets		(1,230	)		(1,378	)
Total deferred tax liabilities	$	(1,362	)	$	(1,491	)
Net deferred tax position	$	–		$	–

We have $28,513 of federal and $1,336 of state net operating loss (“NOL”) carryforwards and $630 in research and development and other credits available to offset future taxable income. These federal and state NOLs will expire at various dates through 2034, except for federal NOLs generated in 2018 and subsequent years. Management analyzed its current operating results and future projections and determined that a full valuation allowance was needed due to our cumulative losses in recent years. We have no uncertain tax positions at December 31, 2023. Accordingly, we do not have any accruals for penalties or interest related to our tax returns. Should an examination or audit arise, we would evaluate the need for an accrual and record one, if necessary. Our federal tax returns from the tax years ended December 31, 2019 through December 31, 2023 are open to examination by the Internal Revenue Service.