Company: IPSI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026455
Chunk: 1436

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 7
Chunk 1436
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(228,714)

     (1,725,826) 
     (912,172)
  
    Deferred income tax asset valuation allowance 
     1,725,826  
     912,172 

    $-  
    $- 

Significant
components of the Company’s deferred income tax assets are as follows:

    December 31, 2024  
    December 31, 2023 
  
    Other 
    $241,491  
    $241,491 
  
    Capital loss 
     491,275  
     491,275 
  
    Net operating losses 
     8,625,904  
     6,900,076 
  
    Stock based compensation 
     511,142  
     511,142 
  
    Valuation allowance 
     (9,869,812) 
     (8,143,984)
  
    Net deferred income tax assets 
    $-  
    $- 

The
valuation allowance for deferred income tax assets as of December 31, 2024 and December 31, 2023 was $9,869,812 and
$8,143,984, respectively. The net change in the deferred income tax assets valuation allowance was an increase of $1,725,826 and
is primarily attributable to tax operating losses and capital losses realized during the current year.

As
of December 31, 2024, the prior three years remain open for examination by the federal or state regulatory agencies
for purposes of an audit for tax purposes.

As
of December 31, 2024, the Company had available for income tax purposes approximately $32.1 million in federal and $30.0 million
in state net operating loss carry forwards, which may be available to offset future taxable income. $3.5 million of the net
operating losses will begin to expire in 2034 and $28.6 million has an indefinite life. Due to the uncertainty of
the utilization and recoverability of the loss carryforwards and other deferred tax assets, Management has determined a full valuation
allowance for the deferred tax assets since it is more likely than not that the deferred tax assets will not be realizable.

The
Company’s ability to utilize the previous Federal operating loss carryforwards may be adjusted if, pursuant to IRC Section 382/383
of the Internal