Income Taxes

3 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

INCOME TAXES

20. INCOME TAXES

During the three months ended March 31, 2021, the Company adopted ASU 2019-12, Income Taxes (Topic 740). This guidance simplifies the accounting for income taxes by removing certain exceptions to the general principles and also simplifies areas such as franchise taxes, step-up in tax basis goodwill, separate entity financial statements and interim recognition of enactment of tax laws and rate changes. The impact that adopting this ASU has not had any material effect on the Condensed Consolidated Financial Statements.

The Company’s income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to loss from continuing operations before tax for the three months ended March 31, 2021 and 2020, due to the following:

	Three Months Ended March 31, 2021						Three Months Ended March 31, 2020
(Amounts in US$’s)	US$’s			Rates			US$’s			Rates
Income tax benefit at statutory federal income tax rate	$	3,403,350			21.00	%	$	1,475,300			21.00	%
State tax expense, net of federal benefit		648,257			4.00	%		281,000			4.00	%
Permanent items		—				%		(400	)		(0.01	)%
Other		—				%		—			—
Valuation allowance		(4,051,607	)			%	$	(1,755,900	)		(24.99	)%
Income tax benefit		—			—	%	$	—			—	%

To determine the quarterly provision for income taxes, the Company uses an estimated annual effective tax rate, which is based on expected annual income, statutory tax rates and tax planning opportunities available in various jurisdictions in which the Company is subject to tax. Certain significant or unusual items are separately recognized in the quarter in which they occur and can be a source of variability in the effective tax rate from quarter to quarter. The Company recognizes interest and penalties related to uncertain tax positions, if any, as an income tax expense. As of March 21, 2021 and December 31, 2020, the Company had not recorded any liabilities for uncertain tax positions. There were no discrete items for the three months ended March 31, 2021.

The Company records uncertain tax positions in accordance with ASC 740, Income Taxes, on the basis of a two-step process in which (1) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon the ultimate settlement with the related tax authority. The Company did not record any liabilities related to uncertain tax positions.

The Company records valuation allowances to reduce its deferred tax assets to an amount it believes is more likely than not to be realized. In assessing the realizability of deferred tax assets, management considers all positive and negative evidence to determine whether future taxable income will be generated during the periods in which those temporary differences become deductible. As a result, the Company recorded a valuation allowance on the portion of the deferred tax assets, including current year losses, deemed not to have enough sources of income to utilize the future benefits.