INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2022

INCOME TAXES

Schedule of provision (benefit) for income taxes

The provision (benefit) for income taxes consists of the following:

	For the Years Ended December 31,
	2022		2021		2020
Current tax provision (benefit)
Federal	$	1,448,000	$	20,041,644	$	4,431,590
State		(8,711,302)		8,079,555		2,049,850
Total current provision (benefit)		(7,263,302)		28,121,199		6,481,440
Deferred tax provision (benefit)
Federal		3,717,559		(6,719,211)		(3,428,399)
State		3,629,613		(2,515,418)		(1,202,807)
Total deferred tax provision (benefit)		7,347,172		(9,234,629)		(4,631,206)
Total income tax provision	$	83,870	$	18,886,570	$	1,850,234

Schedule of tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities

Deferred taxes are provided for those items reported in different periods for income tax and financial reporting purposes.  The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below:

	December 31,
	2022		2021
Deferred tax assets
Net operating loss carry forwards	$	5,053,102	$	130,643
Accrued expenses and reserves		713,429		1,298,083
Employee stock option expense		—		958,530
Nonemployee stock option expense		—		8,887
Inventories		159,405		118,201
Deferred income – TIA contract		15,860,880		18,199,768
Capital loss		67,962		—
Interest expense limitation		24,572		—
Deferred tax assets		21,879,350		20,714,112
Deferred tax liabilities
Unrealized gains/losses		(1,028,232)		(665,960)
Property, plant, and equipment		(14,049,742)		(6,182,318)
Deferred tax liabilities		(15,077,974)		(6,848,278)
Net deferred assets		6,801,376		13,865,834
Valuation allowance		(282,713)		—
Net deferred tax assets	$	6,518,663	$	13,865,834

Schedule of reconciliation of the federal statutory corporate tax rate to the Company's effective tax rate

A reconciliation of the federal statutory corporate tax rate to the Company’s effective tax rate is as follows:

	December 31,
	2022		2021		2020
U.S. statutory federal tax rate	21.0	%	21.0	%	21.0	%
State tax, net of federal tax	1.0		6.4		4.2
Change in valuation allowance	5.5		—		(19.2)
Valuation Allowance	4		—		(0.6)
Stock options	41.7		(0.1)		—
State rate change	(75.1)		—		—
PPP loan	—		(0.4)		—
Return-to-provision and other	3.7		(1.7)		1.7
Effective tax rate	1.6	%	25.2	%	7.1	%

During 2022, the Company engaged tax consultants to perform a nexus study in order to determine if its activities in certain states were subject to previously estimated tax liabilities.  As a result of the study, the Company determined that its activities in those states are protected by P.L. 86-272 and revised its estimates for state taxes.  The Company has further determined that it is more likely than not that the various state jurisdictions will agree that the Company’s activities are protected under P.L. 86-272 and the revised estimates for refund applications are appropriate.