v3.22.4
INCOME TAXES
 12 Months Ended
Sep. 30, 2022
Income Tax Disclosure [Abstract]  
INCOME TAXES

NOTE 12 – INCOME TAXES

 

The Company maintains deferred tax assets and liabilities that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The deferred tax assets on September 30, 2022 and 2021 consist of net operating loss carry-forwards. The net deferred tax asset has been fully offset by a valuation allowance because of the uncertainty of the attainment of future taxable income.

 

The items accounting for the difference between income taxes at the effective statutory rate and the provision for income taxes for the fiscal years ended September 30, 2022 and 2021 are as follow:

 

   2022   2021 
   Years Ended September 30, 
   2022   2021 
Income tax benefit at U.S. statutory rate of 21%   $(2,675,812)  $(1,149,047)
Income tax benefit – state   (589,953)   (253,337)
Non-deductible expenses   1,543,675    (52,467)
Change in valuation allowance   1,722,090    1,454,851 
Total provision for income tax  $—   $— 

 

The Company’s approximate net deferred tax asset as of September 30, 2022 and 2021 was as follow:

 

   2022   2021 
   Years Ended September 30, 
   2022   2021 
Net operating loss carry-forwards  $12,967,136   $11,245,046 
Total deferred tax asset   12,967,136    11,245,046 
Less: valuation allowance   (12,967,136)   (11,245,046)
Net deferred tax asset  $—   $— 

 

The gross operating loss carry forward available to the Company was $50,593,585 on September 30, 2022. The Company provided a full valuation allowance equal to the net deferred income tax asset as of September 30, 2022 and 2021 because it was not known whether future taxable income will be sufficient to utilize the loss carry-forwards. Additionally, the future utilization of the net operating loss carry-forwards to offset future taxable income is subject to annual limitations as a result of ownership or business changes that occurred prior to fiscal year 2022 and may occur in the future. The Company has not conducted a study to determine the limitations on the utilization of these net operating loss carry-forwards.

 

The increase in the valuation allowance was $1,722,090 in fiscal year 2022 and total net tax effected loss carry-forwards on September 30, 2022 was $12,967,136. The potential tax benefit arising from the loss carry-forward of approximately $8,050,201 accumulated through September 30, 2017, will expire in 2037. The potential tax benefit arising from the net operating loss carry-forward of $4,916,935 occurred after the effective date of the current tax act and can be carried forward indefinitely within the annual usage limitations.

 

 

THERALINK TECHNOLOGIES, INC.

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2022 AND 2021