TAX EXPENSE (Tables)

12 Months Ended

Dec. 31, 2016

Tax Expense Tables

Schedule of expense (benefit) for income taxes

	Year Ended December 31,
	2016		2015
Current:
Federal	$	–	$	–
State		–		–
Deferred:
Federal		–		44,000
State		–		–
Total Expense (Benefit) for Income Taxes	$	–	$	44,000

Reconciliation statutory tax rate

	December 31,
	2016			2015
Expected Income Tax Benefit at Statutory Tax Rate, Net	$	(9,469,000	)	$	(3,694,000	)
Non-Deductible Items		1,263,000			368,000
Warrants Expense		–			1,196,000
Derivatives Expense		–			(545,000	)
Net Operating Losses		–			2,667,000
Change in Valuation Allowance		8,206,000			52,000
Reported Income Tax Expense	$	–		$	44,000
Effective Tax Rate		–	%	(0.49		%)

Deferred tax assets and liabilities

	December 31,
	2016			2015
Deferred Income Tax Assets:
Allowance for Bad Debt	$	–		$	74,000
Warrants Expense		4,186,000			3,412,000
Derivatives Expense		4,067,000			729,000
Net Operating Losses		15,242,000			7,029,000
Deferred Income Tax Liabilities:
Depreciation		(1,334,000	)		(44,000	)
Total		22,161,000			11,200,000
Valuation Allowance		(22,161,000	)		(11,244,000	)
Net Deferred Tax Liabilities	$	–		$	(44,000	)