Note 12 - Income Taxes

12 Months Ended

Dec. 31, 2012

Notes

Note 12 - Income Taxes

NOTE 12 - INCOME TAXES

 The net deferred tax asset is comprised of the following:

		December 31,
		2012		2011
Net operating loss carryforwards	$	18,986,174	$	21,039,036
Share-based compensation		1,792,487		1,746,808
Fixed assets		-		63,382
Deposit on building		-		221,055
Other		-		17,716
Valuation allowance		(20,778,661)		(23,087,997)
Deferred income tax asset	$	-	$	-

Loss before income taxes is comprised of:

		For the Years Ended December 31,
		2012		2011
US Operations	$	3,825,448	$	2,784,347
Czech Republic Operations		-		6,297,275
	$	3,825,448	$	9,081,622

The provision for income taxes differs from the amount that would result from applying the federal statutory rate for the years ended December 31, 2012 and 2011 as follows:

		For the Years Ended December 31,
		2012		2011
Net loss	$	3,825,448	$	9,081,622
Tax at federal statutory rate (34%)	$	(1,300,652)	$	(3,087,751)
Effect of lower foreign tax rate		-		944,587
Permanent differences		265,129		(543,292)
		3,344,859		-
Change in valuation allowance		(2,309,336)		2,686,456
Provision for Income Taxes	$	-	$	-

As of December 31, 2012, we had net operating loss carryforwards for U.S. federal income tax reporting purposes which if unused, will expire in the following years:

		US
Year		Amount
2018	$	27,080,269
2019		1,745,867
2020		6,137,725
2021		5,251,175
2022		1,751,322
2023		78,281
2024		413,886
2025		508,429
2026		465,173
2027		760,272
2028		2,494,690
2029		2,121,595
2030		1,688,397
2031		2,433,302
2032		2,911,306
	$	$55,841,689

The utilization of U.S. net operating loss carryforwards may be limited due to the ownership change under the provisions of Internal Revenue Code Section 382. The fiscal years 2009 to 2012 remain open to examination to U.S. Federal authorities and other jurisdictions in the U.S. where we operate.