INCOME TAXES

12 Months Ended

Dec. 31, 2012

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

14. INCOME TAXES

The components of the provision for income tax expense are as follows for the years ended:

	December 31, 2012			December 31, 2011
Current taxes
Federal	$	—		$	—
State		—			—
Current taxes		—			—
Change in deferred taxes		331,111			(1,180,833	)
Change in valuation allowance		(292,880	)		1,241,295
Provision for income tax expense	$	38,231		$	60,462

The following is a summary of the significant components of the Company’s deferred tax assets and liabilities at December 31, 2012:

Deferred tax assets:
Equity based compensation	$	236,145
Allowance for doubtful accounts		12,240
Depreciation and amortization timing differences		—
Net operating loss carryforward		1,071,409
On-line training certificate reserve		1,215
Total deferred tax assets		1,321,009
Valuation allowance		(1,310,924	)
Deferred tax assets net of valuation allowance		10,085
Less deferred tax assets – non-current, net of valuation allowance		9,781
Deferred tax assets – current, net of valuation allowance	$	304

The effective tax rate used for calculation of the deferred taxes as of December 31, 2012 was 34%. The Company has established a valuation allowance against deferred tax assets of $1,310,924, or 99%, due to the uncertainty regarding realization, comprised primarily of a 100% reserve against the net operating carryforward, 100% reserve against the allowance for doubtful accounts, and 95% reserve against the deferred tax assets attributable to the equity based compensation.

The significant differences between the statutory tax rate and the effective tax rates for the Company for the years ended are as follows:

	December 31, 2012			December 31, 2011
Statutory tax rate		—	%		—	%
Increase (decrease) in rates resulting from:
Net operating loss carryforward or carryback		28	%		(31	)%
Equity based compensation and loss		(11	)%		—	%
Book/tax depreciation and amortization differences		—	%		—	%
Change in valuation allowance		(15	)%		32	%
Other		—	%		—	%
Effective tax rate		2	%		1	%

The following is a summary of the significant components of the Company’s deferred tax assets and liabilities at December 31, 2011:

Deferred tax assets:
Equity based compensation	$	21,743
Allowance for doubtful accounts		10,540
Depreciation and amortization timing differences		(4,389	)
Net operating loss carryforward		1,623,065
On-line training certificate reserve		1,162
Total deferred tax assets		1,652,121
Valuation allowance		(1,603,805	)
Deferred tax assets net of valuation allowance		48,316
Less deferred tax assets – non-current, net of valuation allowance		47,735
Deferred tax assets – current, net of valuation allowance	$	581

The effective tax rate used for calculation of the deferred taxes as of December 31, 2011 was 34%. The Company has established a valuation allowance against deferred tax assets of $1,603,805, or 97%, due to the uncertainty regarding realization, comprised primarily of a 98% reserve against the deferred tax assets attributable to the equity based compensation, a 100% reserve against the allowance for doubtful accounts, a 97% reserve against the net operating carryforward, and a 25% reserve against depreciation and amortization timing differences.