Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Components of Provision for Income Taxes

Significant components of the tax expense (benefit) recognized in the accompanying Consolidated Statements of Operations for the years ended December 31, 2022 and December 31, 2021 are as follows:

	Year Ended December 31,
	2022			2021
Current tax benefit
Federal	$	1,196,415		$	290,238
State		241,651			35,940
Total current tax expense		1,438,066			326,178
Deferred tax expense - Federal		(4,181,816	)		1,126,450
Deferred tax expense - State		(1,041,813	)		-
Valuation allowance (expense)		5,223,628			(1,126,450	)
Income tax expense	$	1,438,066		$	326,178

Schedule of Reconciliation of Tax Provision with Expected Provision

The reconciliation of the income tax computed at the combined federal and state statutory rate of (5.4%) for the year ended December 31, 2022 and 6.1% for the year ended December 31, 2021 to the income tax benefit is as follows:

	Year Ended December 31,						Year Ended December 31,
	2022			2022			2021			2021
Benefit on net loss	$	(5,553,496	)		21.0	%	$	1,445,949			27.1	%
Stock based compensation		3,222,271			-12.2	%		-			0.0	%
Section 382 adjustment		(786,165	)		3.0	%		-
Nondeductible expenses		-			-			6,678			0.1	%
Valuation allowance (expense)		5,223,627			-19.8	%		(1,126,449	)		-21.1	%
State income taxes, net of federal benefit		(470,684	)		1.8	%		-			0.0	%
Change in tax rate		(197,487	)		0.7	%		-			-
Tax expense (benefit)/effective rate	$	1,438,066			-5.4	%	$	326,178			6.1	%

Components of Deferred Tax Assets and Liabilities

The significant components of the Company’s deferred tax liabilities and assets as of December 31, 2022 and December 31, 2021 are as follows:

	As of December 31,
	2022			2021
Deferred tax liabilities:
Depreciation	$	538,866		$	-
Right to use assets		67,052			-
Deferred vendor stock compensation		-			261,323
Total deferred tax liabilities		605,918			261,323
Deferred tax assets:
Loss carryforwards - Federal		5,922,644			2,101,401
Loss carryforwards - State		1,195,806			-
Stock option expense		490,892			669,959
Amortization		395,272			503,607
Allowance for credit losses		14,555			16,539
Right to use liability		68,203			-
Unrealized loss on securities		986,639			216,284
Charitable contributions		2,000			-
Total deferred tax asset		9,076,011			3,507,790
Valuation allowance		(8,470,093	)		(3,246,467	)
Net deferred tax asset	$	-		$	-