Income Taxes
 12 Months Ended
Mar. 31, 2016
Notes to Financial Statements  
9. Income Taxes

The Company has a deferred tax asset as shown in the following: 

 

    2016      2015   
Deferred tax asset:             
Tax loss carryforward    $ 3,833,589     $ 3,163,345  
Stock and warrant compensation     704,167       -  
Depreciation and amortization     710,023       -  
Derivative expense     518,139       -  
Other     461,558       -  
Valuation allowance      (6,227,476 )     (3,163,345 )
Net deferred tax asset    $ -     $ -  

  

A valuation allowance has been recognized to offset the deferred tax assets because realization of such assets is uncertain. 

 

The income tax provision differs from the amount of income tax determined by applying the U.S. federal and state income statutory tax rates to pretax income (loss) from continuing operations as follows: 

 

    2016      2015   
Tax benefit at statutory rates    $ 3,064,131     $ 260,759  
Change in valuation allowance    $ (3,064,131 )   $ (260,759 )
Net provision for income taxes    $ -     $ -  

 

Reconciliation of the differences between income tax benefit computed at the federal and state statutory tax rates and the provision for income tax benefit for the years ended March 31, 2016 and 2015 is as follows:

 

    2016      2015   
Income tax expense (benefit) at federal statutory rate     (34.00 )%     (35.00 )%
State taxes, net of federal benefit     (4.63 )     -  
Change in valuation allowance     38.63 %     35.00 %

 

The Company has net operating loss carry-forwards of approximately $11,275,000 at March 31, 2016 that expire beginning in 2025. However, utilization of these losses may be limited pursuant to Section 382 of the Internal Revenue Code due to a recapitalization and subsequent stock issuances.