Annual report pursuant to section 13 and 15(d)

INCOME TAXES (Tables)

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INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2012
Income Tax Disclosure [Abstract]  
Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

Deferred tax assets and liabilities and related valuation allowance as of December 31, 2012 and 2011 are as follows:

 

    December 31,  
    2012     2011  
Deferred tax assets:                
Organization costs   $ -     $ 733  
Research and development credit carryforward (1)     6,188       6,188  
Net operating loss carryforwards     5,207,759       2,329,829  
Other     147,003       132,482  
                 
Total deferred tax assets     5,360,950       2,469,232  
                 
Valuation allowance     (5,360,950 )     (2,469,232 )
                 
Net deferred tax assets   $ 0     $ 0  

  

(1) The Company has incurred research and development (“R&D”) expenses, a portion of which may qualify for tax credits. The Company has not conducted an R&D credit study to quantify the amount of credits and has not claimed an R&D credit on its federal tax returns filed except for $6,188 in 2007. The Company may conduct the study in future years and may establish the R&D credit carryforward for prior years. In such event, the net operating loss carryforward will be correspondingly reduced by the amount of the credit.
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

A reconciliation of the effect of applying the federal statutory rate and the effective income tax rate used to calculate the Company's income tax provision is as follows:

 

    Year Ended
December 31,		  
    2012     2011  
Statutory federal income tax     (34.0 )%     (34.0 )%
State income tax, net of federal tax effect     (10.5 )%     (5.9 )%
Permanent difference     13.9 %     5.0 %
Increase in valuation allowance     30.6 %     34.9 %
                 
Income tax provision     0 %     0 %