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INCOME TAXES

12 Months Ended

Dec. 31, 2021

NOTE 15 — INCOME TAXES

The income tax provision reconciled to the tax computed at the statutory from continuing operations Federal rate follows:

	2021			2020

Tax Expense at Statutory Rate	$	2,133,953		$	1,364,191
Valuation Allowance		(1,787,132	)		(1,371,195	)
Non-Deductible Expenses and Other		3,501			7,004
PPP Loan Forgiveness		(350,322	)		-
State Taxes, Net of Federal Benefit		112,808			89,618
Income tax expense	$	112,808		$	89,618

Current	$	112,808		$	89,618
Total	$	112,808		$	89,618
					-

Deferred income taxes are comprised of the following at December 31, 2021 and 2020:

	2021			2020
Deferred tax assets (liabilities):
Inventories	$	39,433		$	22,620
Stock options and other		6,836			6,836
Contingencies and accruals		224,240			28,580
Property and equipment		(297,984	)		(256,065	)
Net operating loss carryforward		4,500,023			6,527,548
Goodwill and intangibles		40,945			27,085
Total deferred tax assets, net		4,513,493			6,356,604

Valuation allowance	$	(4,513,493	)	$	(6,356,604	)
Net Deferred tax asset		-			-

As of December 31, 2021, the Company had $2,729,636 of net operating loss carry-forwards, related to the Superior Galleries acquisition which may be available to reduce taxable income in future years, subject to the applicable Internal Revenue Code Section 382 limitations. As of December 31, 2021, the Company had approximately $18,699,047 of net operating loss carry-forwards related to Superior Galleries’ post acquisition operating losses and other operating losses incurred by the Company’s other operations. These carry-forwards will expire, starting in 2026 if not utilized.

As of December 31, 2021, the Company has approximately $4.5 million in net deferred tax assets relating to approximately $21.4 million of net operating losses that will begin to expire in 2026 if not used. Due to uncertain current market conditions arising from the COVID-19 pandemic and various strains, the rising threat of inflation, rising interest rates, stock market volatility and the threat of a regional war conflict in Europe spreading, it is unfeasible, with any degree of accuracy, to predict the future results of Company operations. Due to the reasons listed above, a full valuation allowance was recorded against our net deferred tax assets.