丝瓜视频. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes

Income Taxes

12 Months Ended

Apr. 30, 2015

Income Taxes [Abstract]

Income Taxes

Note 12. Income Taxes

The components of income tax expense (benefit) are as follows:

For the Years Ended

April 30,

2015

2014

Current:

Federal

—

State

—

Deferred:

Federal

—

State

—

Total Income tax expense (benefit)

—

Significant components of the Company's deferred income tax assets and liabilities are as follows:


	April 30,
	2015			2014
Deferred tax assets:
Net operating loss	$	7,487,076		$	6,021,134
Allowance for doubtful accounts		21,416			55,679
Intangible assets		304,062			294,284
Deferred rent		2,872			7,948
Stock-based compensation		580,672			411,374
Contributions carryforward		93			93
Total deferred tax assets		8,396,191			6,790,512

Deferred tax liabilities:
Property and equipment		(155,991	)		(126,297	)
Total deferred tax liabilities		(155,991	)		(126,297	)

Deferred tax assets, net		8,240,200			6,664,215

Valuation allowance:
Beginning of year		(6,664,215	)		(4,684,841	)
(Increase) during period		(1,575,985	)		(1,979,374	)
Ending balance		(8,240,200	)		(6,664,215	)

Net deferred tax asset	$	—		$	—

A valuation allowance is established if it is more likely than not that all or a portion of the deferred tax asset will not be realized. The Company recorded a valuation allowance at April 30, 2015 and 2014 due to the uncertainty of realization. Management believes that based upon its projection of future taxable operating income for the foreseeable future, it is more likely than not that the Company will not be able to realize the tax benefit associated with deferred tax assets. The net change in the valuation allowance during the year ended April 30, 2015 was an increase of $1,575,985.

At April 30, 2015, the Company had $20,204,869 of net operating loss carryforwards which will expire from 2030 to 2035. The Company believes its tax positions are all highly certain of being upheld upon examination. As such, the Company has not recorded a liability for unrecognized tax benefits. As of April 30, 2015, tax years 2011 through 2014 remain open for IRS audit. The Company has received no notice of audit from the Internal Revenue Service for any of the open tax years.

A reconciliation of income tax computed at the U.S. statutory rate to the effective income tax rate is as follows:


	April 30,
	2015			2014
Statutory U.S. federal income tax rate		34.0	%		34.0	%
State income taxes, net of federal tax benefit		3.0			3.1
Other		(0.1	)		(0.1	)
Change in valuation allowance		(36.9	)		(37.0	)
Effective income tax rate		0.0	%		0.0	%