U. S. Securities and Exchange Commission
                    Washington, D. C.  20549

                          FORM 10-QSB

  [X]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
  EXCHANGE ACT OF 1934

       For the quarter ended March 31, 2006

  [ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

       For the transition period from      to

                   Commission File No.   000-33381

               WIZZARD SOFTWARE CORPORATION
               ----------------------------
      (Name of Small Business Issuer in its Charter)

        COLORADO                                             87-0575577
        --------                                             ----------
  (State or Other Jurisdiction of                        (I.R.S. Employer
   incorporation or organization)                        Identification No.)

                     5001 Baum Boulevard, Suite 770
                     Pittsburgh, Pennsylvania 15213
                     ------------------------------
               (Address of Principal Executive Offices)

              Issuer's Telephone Number:  (412) 621-0902

  Check whether the issuer (1) has filed all reports required to be filed by
  Sections 13 or 15(d) of the Exchange Act during the past 12 months (or for
  such shorter period that the registrant was required to file such reports),
  and (2) has been subject to such filing requirements for the past 90 days.

  (1) Yes  X  No                (2) Yes   X   No
          ---    ---                     ---     ---

  Indicate by check mark whether the registrant is a shell company (as defined
  by Rule 12b-2 of the Exchange Act)  Yes   No  X
                                         ---   ---

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
                      PRECEDING FIVE YEARS

                              N/A
                              ----

             (APPLICABLE ONLY TO CORPORATE ISSUERS)

  State the number of shares outstanding of each of the Issuer's classes of
  common equity, as of the latest practicable date:

                            March 31, 2006
                           Common   29,282,511 shares

  Transitional Small Business Issuer Format   Yes      No  X
                                                  ---     ---

                 PART I - FINANCIAL INFORMATION

  Item 1.   Financial Statements.
            ---------------------

  The Consolidated Financial Statements of the Company required to be filed
  with this 10-QSB Quarterly Report were prepared by management and commence
  on the following page, together with related Notes.  In the opinion of
  management, the Consolidated Financial Statements fairly present the
  financial condition of the Company.
  <PAGE>

         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES

          UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                         MARCH 31, 2006
  <PAGE>

         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES


                            CONTENTS

                                                                        PAGE



          Unaudited Consolidated Balance Sheet,
          March 31, 2006                                                  2

          Unaudited Consolidated Statements of Operations,
          for the three months ended March 31, 2006 and 2005              3

          Unaudited Consolidated Statements of Cash Flows,
          for the three months ended March 31, 2006 and 2005          4 - 5

          Notes to Unaudited Consolidated
          Financial Statements                                       6 - 18
<PAGE>
           WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEET

                              ASSETS
                                                              March 31,
                                                               2006
                                                               ----
  CURRENT ASSETS:
     Cash                                                   $  287,523
     Accounts receivable, net of $74,738 allowance             262,155
     Inventory, net of $61,690 allowance                        11,831
     Prepaid expenses                                           44,448
                                                            ----------
          Total current assets                                 605,957

  LEASED EQUIPMENT, net                                        131,853

  PROPERTY AND EQUIPMENT, net                                   97,617

  GOODWILL                                                     896,570

  OTHER ASSETS                                                   5,582
                                                            ----------
          Total assets                                      $1,737,579
                                                            ==========

               LIABILITIES AND STOCKHOLDERS' EQUITY
  CURRENT LIABILITIES:
     Accounts payable                                       $  140,930
     Accrued expenses                                          110,941
     Capital Lease   current portion                            35,250
     Deferred revenue                                            1,841
     Notes payable                                             799,999
                                                            ----------
          Total current liabilities                          1,088,961

  CAPITAL LEASE, less current portion                          110,642
                                                            ----------
          Total liabilities                                 $1,199,603
                                                            ----------
  COMMITMENT & CONTINGENCIES                                         -

  STOCKHOLDERS' EQUITY:
     Preferred stock, $.001 par value, 10,000,000 shares
        authorized, no shares issued and outstanding                 -
     Common stock, $.001 par value, 100,000,000 shares
        authorized, 29,282,511 shares issued and
        outstanding                                             29,283
     Additional paid-in capital                             20,542,267
     Accumulated deficit                                   (20,033,574)
                                                           -----------
          Total stockholders' equity                           537,976
                                                           -----------
          Total liabilities and stockholders' equity       $ 1,737,579
                                                           ===========


The accompanying notes are an integral part of this consolidated financial
                            statement.
<PAGE>
          WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF OPERATIONS

                                                     For the Three
                                                      Months Ended
                                                      March 31,
                                                   ______________________
                                                      2006        2005
                                                   _________    _________
  NET SALES                                        $ 602,391    $ 223,561

  COST OF GOODS SOLD                                 377,538      125,338
                                                   _________    _________
     Gross Profit                                    224,853       98,223
                                                   _________    _________

  OPERATING EXPENSES:
     Selling expenses                                 90,167       95,912
     General and administrative                      672,148      450,125
     Research and development                         11,318       30,026
     Compensation for re-pricing warrants                  -            -
     Non-cash investor relations services                  -      141,000
     Impairment of goodwill                                -    1,191,967
                                                   _________    _________
          Total Expenses                             773,633    1,909,030
                                                   _________    _________
  LOSS FROM OPERATIONS                              (548,780)  (1,810,807)
                                                   _________    _________

  OTHER INCOME (EXPENSE):
     Gain (loss) on disposal of assets                    (9)           -
     Interest expense   related party                      -            -
     Interest expense                                (15,439)  (1,413,206)
     Interest income                                   6,029            -
                                                   _________    _________
          Total Other Income (Expense)                (9,419)  (1,413,206)
                                                   _________    _________

  LOSS BEFORE INCOME TAXES                          (558,199)  (3,224,013)

  CURRENT INCOME TAX EXPENSE                               -            -

  DEFERRED INCOME TAX EXPENSE                              -            -
                                                   _________    _________

  NET LOSS                                         $(558,199) $(3,224,013)
                                                   _________    _________

  BASIC AND DILUTED LOSS PER COMMON SHARE:         $    (.02) $      (.12)
                                                   _________    _________


The accompanying notes are an integral part of these consolidated financial
                            statements.
<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
        UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                         For the Three
                                                          Months Ended
                                                           March 31,
                                                       ______________________
                                                    2006          2005
                                                   _________    ___________

  Cash Flows from Operating Activities:
     Net loss                                      $ (558,199)  $(3,224,013)
     Adjustments to reconcile net loss to net
     cash used in operating activities:
       Amortization of discount on notes payable            -     1,400,000
       Stock for non cash expenses                    264,189       244,272
       Impairment of goodwill                               -     1,191,967
       Loss on disposal of assets                           -             -
       Depreciation and amortization expense           17,695         8,523
       Change in assets and liabilities:
        Accounts receivable                            37,225           954
        Inventory                                       5,046          (627)
        Prepaid expenses                              (19,934)       45,500
        Accounts payable                              (74,023)      114,499
        Accrued expense                                 7,092         8,216
        Deferred revenue                              (11,470)            -
                                                   ----------   -----------
      Net Cash Used in Operating Activities          (332,379)     (210,709)
                                                   ----------   -----------
Cash Flows from Investing Activities:
      Purchase of property & equipment                 (1,217)       (6,701)
                                                   ----------   -----------
      Net Cash Used in Investing Activities            (1,217)       (6,701)
                                                   ----------   -----------

Cash Flows from Financing Activities:
      Proceeds from the issuance of common stock            -       146,226
      Proceeds from issuance of convertible note
      payable                                               -     1,400,000
      Payments on capital lease                        (8,582)            -
      Payments on note payable                       (239,576)      (25,076)
                                                   ----------   -----------
          Net Cash Provided by (Used in) Financing
          Activities                                 (248,158)    1,521,150
                                                   ----------   -----------
Net Increase (Decrease) in Cash                      (581,754)    1,303,740
                                                   ----------   -----------
Cash at Beginning of Period                           869,277       445,702
                                                   ----------   -----------
Cash at End of Period                              $  287,523   $ 1,749,442
                                                   ==========   ===========
Supplemental Disclosures of Cash Flow Information:
     Cash paid during the periods for:
       Interest                                    $    3,899   $     4,830
       Income taxes                                $        -   $         -

<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
             CONSOLIDATED STATEMENTS OF CASH FLOWS


Supplemental Schedule of Non-cash Investing and Financing Activities:

  For the three months ended March 31, 2006:

       On January 19, 2006, the Company issued 100,000 restricted
       common shares valued at $180,000 for consulting services.

       On January 23, 2006, the Company issued 45,755 common
       shares upon the exercise of options valued at $84,189 to
       employees and non-employees for services rendered.

       On March 23, 2006, the Company issued 50,569 common shares
       in payment of a $75,000 note payable and $854 of accrued
       interest.

       On March 29, 2006, the Company issued 50,611 common shares
       in payment of a $75,000 note payable and $917 of accrued
       interest.

  For the three months ended March 31, 2005:

       The Company issued 22,500 common shares valued at $54,900
       for consulting services.

       The Company issued 60,000 common shares valued at $141,000
       for investor relations services.

       The Company issued 20,584 common shares valued at $48,372
       to 18 employees for the exercise of options.

       The Company issued 100,000 common shares upon conversion of
       $50,000 of the 8% convertible note payable.

       The Company issued 787,176 common shares for the purchase
       of the remaining 5% minority shares of WSC.  The resulting
       goodwill of $1,191,967 was impaired immediately.
<PAGE>
      WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
  NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Unaudited Consolidated Financial Statements - The accompanying financial
statements have been prepared by the Company without audit.  In the opinion of
management, all adjustments (which include only normal recurring adjustments)
necessary to present fairly the financial position, results of operations and
cash flows at March 31, 2006 and 2005 and for the periods then ended have been
made.  The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions for Form 10-QSB of the Securities
and Exchange Commission.  Certain information and footnote disclosures
normally included in financial statements prepared in accordance with U.S.
generally accepted accounting principles in the United States of America have
been condensed or omitted.  These consolidated financial statements should be
read in conjunction with the financial statements and notes thereto included
in the Company's December 31, 2005 audited financial statements.  The results
of operations for the three months ended March 31, 2006 and 2005 are not
necessarily indicative of the operating results for the full year.

Organization Wizzard Software Corporation ["Parent"], a Colorado corporation,
was organized on July 1, 1998.  The Company has, at the present time, not paid
any dividends and any dividends that may be paid in the future will depend
upon the financial requirements of the Company and other relevant factors.  On
January 19, 2005, Parent acquired the remaining 5% minority interest of
Wizzard Software Corp. ["WSC"], wherein WSC was merged into Parent.  The
Company engages primarily in the development, sale, and service of custom and
packaged computer software products.  On September 8, 2005, Parent purchased
all of the issued and outstanding shares of Interim Healthcare of Wyoming,
Inc. ["Interim"], a Wyoming corporation, in a transaction accounted for as a
purchase.  Interim engages primarily in providing healthcare services in
Wyoming.

Consolidation - The financial statements presented reflect the accounts of
Parent, Speech, MedivoxRx, and Interim.  All significant inter-company
transactions have been eliminated in consolidation.

Accounting Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, the disclosures of contingent assets and liabilities at the date
of the financial statements, and the reported amounts of revenues and expenses
during the reporting period.  Actual results could differ from those estimated
by management.

Reclassification   The financial statements for the period ended prior to
March 31, 2006 have been reclassified to conform to the headings and
classifications used in the March 31, 2006 financial statements.

<PAGE>
      WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
  NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Cash and Cash Equivalents - At March 31, 2006, the Company had cash balances
of $104,574 in excess of federally insured limits.

Accounts Receivable - Accounts receivable consist of trade receivables arising
in the normal course of business. At March 31, 2006, the Company has an
allowance for doubtful accounts of $74,738 which reflects the Company's best
estimate of probable losses inherent in the accounts receivable balance. The
Company determines the allowance based on known troubled accounts, historical
experience, and other currently available evidence. During the three months
ended March 31, 2006 and 2005, the Company adjusted the allowance for bad debt
by $0 and $0, respectively.

Inventory - Inventory consists of software, health care products and supplies
and is carried at the lower of cost or market on a first in first out basis.

Depreciation - Depreciation of property and equipment is provided on the
straight-line method over the estimated useful lives of the assets of two to
ten years.

Goodwill and Definite-life intangible assets - Goodwill represented the excess
of costs over the fair value of the identifiable net assets of businesses
acquired.  Definite-life intangible assets consist of website development
cost, patents, trademarks, purchased rights to a Merchant Operating
Understanding (for the distribution of the Company's products) and trade
secrets of the speech recognition software ActiveX Voice Tools, purchased in
the acquisition of Speech Systems, Inc., and a patents pending and trademarks
acquired in the purchase of MedivoxRx Technologies, Inc.   The Company
accounts for Goodwill and definite-life intangible assets in accordance with
provisions of Statement of Financial Accounting Standards "SFAS" No. 142,
"Goodwill and Other Intangible Assets".  Goodwill and intangible assets
acquired in a purchase business combination and determined to have an
indefinite useful life are not amortized, but instead are tested for
impairment at least annually in accordance with the provisions of SFAS No.
142.  Impairment losses arising from this impairment test, if any, are
included in operating expenses in the period of impairment.  SFAS No. 142
requires that definite intangible assets with estimable useful lives be
amortized over their respective estimated useful lives, and reviewed for
impairment in accordance with SFAS No. 144, Accounting for Impairment or
Disposal of Long-Lived Assets.

Software Development Costs - Statement of Financial Accounting Standards
("SFAS") No. 86 "Accounting for the Costs of Computer Software to be Sold,
Leased or Otherwise Marketed" requires software development costs to be
capitalized upon the establishment of technological feasibility. The
establishment of technological feasibility and the ongoing assessment of the
recoverability of these costs require considerable judgment by management with
respect to certain external factors such as anticipated future revenue,
estimated economic life, and changes in software and hardware technologies.
Capitalizable software development costs have not been significant and
accordingly no amounts are shown as capitalized at March 31, 2006.
<PAGE>
      WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
  NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Loss Per Share - The Company computes loss per share in accordance with
Statement of Financial Accounting Standards "SFAS" No. 128 "Earnings Per
Share," which requires the Company to present basic earnings per share and
diluted earnings per share when the effect is dilutive (see Note 10).

Income Taxes - The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109, "Accounting for Income
Taxes."  This statement requires an asset and liability approach for
accounting for income taxes.

Advertising Costs - Advertising costs are expensed as incurred and amounted
to $20,213 and $21,911 for the three months ended March 31, 2006 and 2005,
respectively.

Fair Value of Financial Instruments - The fair value of cash, accounts
receivable, accounts payable and notes payable are determined by reference to
market data and by other valuation techniques as appropriate. Unless otherwise
disclosed, the fair value of financial instruments approximates their recorded
values due to their short-term maturities.

Revenue Recognition - The Company's revenue recognition policies are in
compliance with the American Institute of Certified Public Accountants
Statement of Position ("SOP") 97-2 (as amended by SOP 98-4 and SOP 98-9) and
related interpretations, "Software Revenue Recognition" and the Securities and
Exchange Commission Staff Accounting Bulletin No. 101 and 104.

Software - The Company sells packaged and custom software products and
related voice recognition product development consulting.

Software product revenues are recognized upon shipment of the software
product only if no significant Company obligations remain, the fee is fixed or
determinable, and collection is received or the resulting receivable is deemed
probable. Revenue from package software products are recorded when the payment
has been received and the software has been shipped.  Revenue is recognized,
net of discount and allowances, at the time of product shipment.  For packaged
software products the Company offers a 30 day right of return.  Provisions are
recorded for returns, concessions, and bad debts and at March 31, 2006 and
2005 amounted to $0. Revenue related to obligations, which include telephone
support for certain packaged products, are based on the relative fair value of
each of the deliverables determined based on vendor-specific objective
evidence ("VSOE") when significant. The Company VSOE is determined by the
price charged when each element is sold separately. Revenue from packaged
software product sales to and through distributors and resellers is recorded
when payment is received and the related products are shipped. The Company's
distributors or resellers do not carry packaged software product inventory and
thus the Company does not offer any price protections or stock balancing
rights.
<PAGE>
      WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
  NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Healthcare - The Company recognizes revenue from the providing of healthcare
services when the services are provided and collection is probable.  Revenues
for the talking pill bottle are recognized when the product is shipped and
collections are probable.

Stock Options - The Company has stock option plans that provide for stock-
based employee compensation, including the granting of stock options, to
certain key employees. The plans are more fully described in Note 9. Prior to
January 1, 2006, the Company applied APB Opinion No. 25, "Accounting for
Stock Issued to Employees", and related Interpretations in accounting for
awards made under the Company's stock-based compensation plans.  Under this
method, compensation expense was recorded on the date of grant only if the
current market price of the underlying stock exceeded the exercise price.

During the periods presented in the accompanying financial statements, the
Company has granted options under its 2002, 2004 and 2005 defined stock
options plans. The Company has adopted the provisions of SFAS No. 123R using
the modified-prospective transition method and the disclosures that follow
are based on applying SFAS No. 123R.  Under this transition method,
compensation expense recognized during the three months ended March 31, 2005
included:  (a) compensation expense for all share-based awards granted prior
to, but not yet vested as of January 1, 2006, and (b) compensation expense
for all share-based awards granted on or after January 1, 2006.  Accordingly,
compensation cost of $0 has been recognized for grants of options to
employees and directors in the accompanying statements of operations with a
associated recognized tax benefit of $0 of which $0 was capitalized as an
asset for the period ended March 31, 2006.  In accordance with the modified-
prospective transition method, the Company's financial statements for the
prior year have not been restated to reflect, and do not include, the impact
of SFAS 123R.  Had compensation cost for the Company's stock option plans and
agreements been determined based on the fair value at the grant date for
awards in 2005 consistent with the provisions of SFAS No. 123R, the Company's
net loss and basic net loss per common share would not have changed.

Research and Development Cost - The Company expenses the cost of developing
new products as incurred as research and product development costs.
Included in general and administrative expense for the three months ended
March 31, 2006 and 2005 are $11,318 and $30,026, respectively, of research and
development costs associated with the development of new products.

Restatement - The financial statements have been restated to record $44,861
in payroll liabilities associated with stock issued to employees during 2005
and 2004.  The effect on the financial statements increased accrued expense
and the accumulated deficit by $44,861 and increased general and
administrative
from $441,909 to $450,125 and increased the net loss from $3,215,797 to
$3,224,013 for the three months ended March 31, 2005. The restatement had no
effect on the stated net loss per share for the three months ended March 31,
2005.

NOTE 2 - GOING CONCERN

The accompanying consolidated financial statements have been prepared in
conformity with generally accepted accounting principles of the United States
of America, which contemplate continuation of the Company as a going concern.
However, the Company has incurred significant losses and has not yet been
successful in establishing profitable operations.  Further, the Company has
current liabilities in excess of current assets.  These factors raise
substantial doubt about the ability of the Company to continue as a going
concern.  In this regard, management plans to mitigate this doubt by raising
additional funds through debt and/or equity offerings and by substantially
increasing sales.  There is no assurance that the Company will be successful
in achieving profitable operations.  The financial statements do not include
any adjustments that might result from the outcome of these uncertainties.

NOTE 3 - INVENTORIES

     The following is a summary of inventories:
                                               March 31, 2006
     Raw materials                             $      59,005
     Finished goods                                   14,516
     Less: Allowance for obsolete inventory          (61,690)
                                               -------------
                                               $      11,813
                                               =============

<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
      NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 - PROPERTY & EQUIPMENT

  The following is a summary of property and equipment at:
                                                              March 31
                                             Life                2006


     Furniture, fixtures and equipment       2 - 10 yrs    $   169,240
     Production molds                          3 yrs            47,710
     Software                                2   5 yrs          11,964
                                                           -----------
                                                               228,914
     (Less) Accumulated Deprecation                           (131,297)
                                                           -----------
     Property & Equipment, net                             $    97,617
                                                           -----------

Depreciation expense for the three months ended March 31, 2006 and 2005 was
$9,704 and $8,523, respectively.

  The following is a summary of leased equipment at:
                                                            March 31
                                         Life                 2006


     Leased Equipment                     5.25 Yrs         223,750
     Less: Accumulated Depreciation                        (91,897)
                                                         ---------
     Leased Equipment, net                               $ 131,853
                                                         ---------

Depreciation expense for the three months ended March 31, 2006 and 2005 was
$7,991 and $0, respectively.

NOTE 5   GOODWILL / DEFINITE-LIFE INTANGIBLE ASSETS

Intangible Assets - The Company classifies its intangible assets as
definite-life intangible assets and amortizes them on a straight-line basis
over their estimated useful lives.  Amortization expense of $0 was recorded
for the three months ended March 31, 2006 and 2005.

Goodwill - On September 8, 2005, the Company recorded goodwill of $896,570 in
connection with the acquisition of Interim Health Care of Wyoming as the
purchase price of $904,006 exceeded the $7,436 net book value of the assets
acquired.
<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
      NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 6 - NOTES PAYABLE

Convertible Note Payable - On September 14, 2001, the Company issued a Series
2001-A 8% convertible note payable of the Company in the amount of $250,000,
with a maturity date of August 1, 2011. The Note was convertible into the
Company's common stock at the lesser of $0.50 per share or 75% of the
closing bid price. During the year ended December 31, 2001, $15,000 of the
note with related accrued interest of $208 was converted into 30,416 shares
of common stock. During the year ended December 31, 2004 $135,000 of the
note with related accrued interest of $47,837 was converted into 287,689
common shares. As the conversion price was below the fair value of the
common stock on the date issued the Company has recorded the beneficial
conversion feature of the note in accordance with the provisions found in
EITF 98-5 by recording a $250,000 discount on the note. The discount was
recorded as interest expense on September 14, 2001 as the note was
immediately convertible. The note called for the Company to register the
underlying shares into which the note can be converted by March 15, 2002,
which did not occur. On May 3, 2004 the Company issued 19,286 restricted
common shares for the payment of the $67,500 penalty for the delay in the
registration equal to $7,500 for the first month then $10,000 for every
month thereafter through October 2002. During the year ended December 31,
2005, the Company issued 223,850 shares of common stock in payment of the
remaining $100,000 and $11,925 in accrued interest.

Related Party Note Payable   During the year ended December 31, 2001, a
shareholder loaned the Company $46,076. The demand note is unsecured and
accrued interest at 5% per annum.  In May 2005, the Company repaid the
remaining $25,076 in principal and $4,830 in accrued interest.

On February 8, 2005, the Company closed a Subscription Agreement by which
three institutional investors purchased promissory notes having a total
principal amount of $1,400,000, convertible into shares of the Company's
common stock at a price of $1.50 per share, and bearing an annual interest
rate of five percent; Class A Warrants to purchase a total of 466,667 shares
of common stock at a price of $2.50 per share, exercisable for three years;
and Class B Warrants to purchase a total of 933,334 shares of common stock at
a price of $1.50 per share, exercisable until 150 days after the effective
date of the Registration Statement. In December 2005, the Company repriced
466,667 of the Class B warrants from $1.50 to $1.15 exercise price and were
immediately exercised. Also in December 2005, the remaining 466,667 Class B
warrants had their life extended one year. At March 31, 2006 $799,999
remained outstanding.

NOTE 7 - CAPITAL LEASE OBLIGATION

The Company is leasing equipment on a 63-month capital lease terminating in
August 2008.  Monthly payments of $3,750 began in June 2003 and a payment of
$54,688 is due at termination.  During the three months ended March 31, 2006
and 2005, interest expense on capital lease obligation amounted to $2,668
and $0, respectively.

<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
      NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7 - CAPITAL LEASE OBLIGATION Continued)

Future minimum capital lease payments are as follows for the twelve-month
periods ended:

      March 31, 2007                           $   45,000
      March 31, 2008                               45,000
      March 31, 2009                               73,438
                                               ____________
      Total minimum lease payments                163,438
      Less amount representing interest           (17,546)
                                               ____________
      Present value of minimum lease payments     145,892
      Less current portion                        (35,250)
                                               ____________
                                               $  110,642
                                               ============
NOTE 8 - CAPITAL STOCK

Preferred Stock   The Company has authorized 10,000,000 shares of preferred
stock, $.001 par value.  As of March 31, 2006, no shares were issued
and outstanding.

Common Stock   The Company has authorized 100,000,000 shares of common
stock, $.001 par value.  As of March 31, 2006, the Company had
29,282,511 common shares issued and outstanding.

Stock for Services   On January 19, 2006, the Company issued 100,000
common shares valued at $180,000 for consulting services.

Stock for Services   On January 23, 2006, the Company issued 45,755 common
shares upon the exercise of options valued at $84,189 to employees and
non-employees for services rendered.

Conversion of Notes Payable   On March 23, 2006, the Company issued
50,569 common shares in payment of a $75,000 note payable and $854
of accrued interest.

Conversion of Notes Payable   On March 29, 2006, the Company issued 50,611
common shares in payment of a $75,000 note payable and $917 of
accrued interest.

Exercise of Warrants   On January 6, 2005, March 18, 2005, and March 28, 2005,
the Company issued 4,339, 40,000, and 50,000 common shares, respectively, upon
the exercise of warrants at $1.55 per share.

<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
      NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8 - CAPITAL STOCK (Continued)

Conversion of Notes Payable   During 2005, the Company issued 150,000 common
shares upon conversion of $75,000 of the 8% convertible note payable.

Stock for Services - On February 11, 2005, the Company issued 22,500 common
shares for consulting services valued at $54,900.

On February 15, 2005, the Company issued 60,000 common shares for investor
relations services valued at $141,000.

Stock for Employee Services - On February 15, 2005, the Company issued 20,584
common shares upon the exercise of options for consulting services valued at
$48,166.

Acquisition of Minority Interest - On January 19, 2005, the Company
shareholders approved the acquisition of the 5% minority interest of Wizzard
Software Corp ("WSC") wherein WSC was merged with and into the Parent through
the issuance of 787,176 common shares of the Parent for the 787,176 minority
shares of WSC.

5% Convertible Notes Payable - On February 8, 2005, the Company closed a
Subscription Agreement by which three institutional investors
("Subscribers") purchased: 5% convertible promissory notes having a total
principal amount of $1,400,000, convertible into 933,333 shares of the
Company's common stock at a price of $1.50 per share,  plus Class A Warrants
to purchase a total of 466,667 shares of common stock at a price of $2.50
per share, exercisable for three years; and Class B Warrants to purchase a
total of 933,334 shares of common stock at a price of $1.50 per share,
exercisable until 150 days after the effective date of the Registration
Statement described below.

The $1,400,000 in proceeds has been recorded as paid in capital based on their
relative fair value of $574,184, $308,989 and $516,827, for the beneficial
conversion feature of the Convertible Notes Payable, Class A Warrants and
Class B Warrants, respectfully. The Company upon issuance recorded interest
expense of $1,400,000 for the discount on the note as the note is
immediately convertible.

The relative fair values of the warrants and beneficial conversion feature
were estimated using the black-scholes pricing model using the following
variable volatility of 104%, risk free interest rate of 3%, expected yield of
0% and estimated lives of one to three years.


<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
      NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9   STOCK OPTIONS AND WARRANTS

The significant weighted average assumptions relating to the valuation of the
Company's Stock Options for the three months ended March 31, 2006 were as
follows:

                                         2006
                                         ----

Dividend yield                           0%
Expected life                            1 day
Expected volatility                      0%
Risk-free interest rate                  4.6%

A summary of the status of options granted at March 31, 2006, and changes
during the period then ended are as follows:

                                  For the Three Months Ended
                                        March 31, 2006
                                        --------------

                                                  Weighted
                                 Weighted         Average
                                 Average          Remaining          Aggregate
                                 Exercise         Contractual        Intrinsic
                Shares           Price            Term               Value
                ------           -----            ----               -----

Outstanding at       -           $    -              -                   -
beginning
of period

Granted         38,255             1.84              -                   -
Exercised      (38,255)            1.84              -                   -
Forfeited            -                -              -                   -
Expired              -                -              -                   -

Outstanding at       -                -              -                   -
end of
period

Vested and           -                -              -                   -
expected to
vest in the
future

Exercisable at       -                -              -                   -
end of
period

Weighted        38,255             0.00
average
fair value of
options granted


The Company had no non vested options at the beginning of the period.  At
March 31, 2006 the Company had no non vested options.

The total intrinsic value of options exercised during the three months ended
March 31, 2006 and 2005 was $0 and $0 respectively.  Intrinsic value is
measured using the fair market value at the date of exercise (for shares
exercised) or at March 31, 2006 and 2005 (for outstanding options), less the
applicable exercise price.


During the three month period ended March 31, 2006 and 2005, the Company
expensed $84,189 and $48,372 upon the exercise of awards.  The Company
realized no tax benefit due to the exercise of options as the Company had a
loss for the period and historical net operating loss carry forwards.


Warrants - A summary of the status of the warrants granted is presented below
for the three months ended:


                           March 31, 2006    March 31, 2005
                          __________________________________________________
                          Weighted Average               Weighted Average
                       Shares  Exercise Price         Shares  Exercise Price
                          __________________________________________________
  Outstanding at
   beginning of period    1,663,167     $1.89         844,172          $1.55
   Granted                        -         -       1,400,000          $1.83
   Exercised                      -         -         (94,339)         $1.55
   Forfeited                      -         -               -              -
   Expired                        -         -               -              -
                          __________________________________________________
  Outstanding at end
   of period              1,663,167     $1.89       2,149,833          $1.73
                          __________________________________________________
<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
      NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 - LOSS PER COMMON SHARE

The following data show the amounts used in computing loss per share and the
weighted average number of shares of common stock outstanding for the
periods presented:

                                                For the Three Months Ended
                                                        March 31,
                                                     2006        2005
                                               ___________________________
  Loss available to
   common shareholders (numerator)              $(558,199)     $(3,224,013)
                                               ___________     ____________
  Weighted average number of common shares
   outstanding during the period (denominator) 29,165,258       26,835,990
                                               ___________     ____________

At March 31, 2006, the Company had 1,663,167 warrants outstanding to purchase
common stock of the Company at $1.15 to $2.50 per share, and a 5%
convertible note payable wherein the holder could convert the note into a
minimum of 466,667 shares of common stock, See Note 6], which were not
included in the loss per share computation because their effect would be
anti-dilutive.

At March 31, 2005, the Company had 2,091,835 warrants outstanding to purchase
common stock of the Company at $.25 to $1.55 per share, a 8% convertible
note payable wherein the holder could convert the note into a minimum of
100,000 shares of common stock and a 5% convertible note payable wherein the
holder could convert the note into 933,333 shares, [See Note 6], which were
not included in the loss per share computation because their effect would be
anti-dilutive.

NOTE 11 -  INCOME TAXES

The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes".  SFAS
No. 109 requires the Company to provide a net deferred tax asset/liability
equal to the expected future tax benefit/expense of temporary reporting
differences between book and tax accounting methods and any available
operating loss or tax credit carryforwards.  The Company has available at
March 31, 2006 operating loss carryforwards of approximately $19,000,000 which
may be applied against future taxable income and which expires in various
years through 2025.

The amount of and ultimate realization of the benefits from the operating loss
carryforwards for income tax purposes is dependent, in part, upon the tax
laws in effect, the future earnings of the Company, and other future events,
the effects of which cannot be determined.
<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
      NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 -  INCOME TAXES (Continued)

Because of the uncertainty surrounding the realization of the loss
carryforwards and significant changes in the ownership of the Company, a
valuation allowance has been established equal to the tax effect of the loss
carryforwards and, therefore, no deferred tax asset has been recognized for
the loss carryforwards.  The net deferred tax assets are approximately
$6,460,000 as of March 31, 2006, with an offsetting valuation allowance of
the same amount.  The change in the valuation allowance for the three months
ended March 31, 2006 approximated $170,000.

NOTE 12 - COMMITMENTS AND CONTINGENCIES

The Company is from time to time involved in routine legal and administrative
proceedings and claims of various types.  While any proceedings or claim
contains an element of uncertainty, Management does not expect on our
results of operations or financial position.

Contingent Consideration for the Acquisition of MedivoxRx   In connection with
the acquisition of MedivoxRx, Parent will issue an additional 100,000
restricted common shares to the former stockholders of MedivoxRx if Wizzard
Merger Corp. achieves repeat sales of at least 250 units per month from at
least 15 VA sites for three consecutive months with a specified gross margin.
Parent will also issue an additional 50,000 restricted common shares to the
former stockholders of MedivoxRx if Wizzard Merger Corp. pill bottle
simultaneously loads the prescription while the label is being printed and is
approved and accepted by any Veterans Administration Hospital.  Parent will
further issue an additional 625,000 restricted common shares to the former
stockholders of MedivoxRx if Wizzard Merger Corp. meets revenue and profit
projections for the second year of operations forward from the April 23, 2004
acquisition date.  To date no additional restricted common shares have been
issued.

Agreements - In connection with the agreement with AT&T to sell to AT&T's OEM
Natural Voices desktop product licenses the Company is required to make
minimum purchase of $125,000 per each six month period beginning  July 2004
through June 2007.

In connection with the agreement with IBM to sell IBM's OEM ViaVoice desktop
products licenses the Company is required to make minimum purchases of
$12,500 per quarter beginning July 2005 through June 2007.

Contingent Consideration for the Acquisition of Interim Health Care of
Wyoming, Inc.   As part of the Interim of Wyoming, Inc. acquisition, the
Company agreed to issue additional shares of common stock upon Interim
achieving certain financial results. Phase I incentives includes the
seller to receive an additional payment of two (2) times the Interim EBITDA
for the year ended September 30, 2006, based upon the amounts that exceeds the
Interim EBITDA for the year ended December 31, 2004. Twenty-five percent of
which will be paid in cash and seventy-five percent paid in stock.
<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
      NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12 - COMMITMENTS AND CONTINGENCIES (Continued)

Phase II incentives includes the seller to receive an additional payment
of two
times the EBITDA for the year ended September 30, 2007, based upon the
amount that exceeds the Interim EBITDA for the year ended September 30,
2006. Twenty-five percent of which will be paid in cash and seventy-five
percent paid in stock.

NOTE 13 - SEGMENT REPORTING

The Company's operations are divided into two independent segments   software
and healthcare. The Company does not have any inter-segment revenues and the
Company uses the same accounting principles used to prepare the consolidated
financial statements for both operating segments.

At March 31, 2006, all of the Company's assets, except approximately $19,300
of inventory, are located within the United States of America.

Software - The Company attributes revenues from the development, sale, and
service of custom and packaged computer software products at the time the
product is shipped and collections are likely.

Healthcare - The Company attributes revenue from the development, sale, and
service of talking prescription pill bottles and healthcare services at the
time the services are rendered and collections are likely.

The following is a summary of the Company's operations by segment for the
three months ended March 31, 2006 and 2005:
                                   2006                      2005
                                   ----                      ----
       ____________________________
                Software  Healthcare    Total    Software  Healthcare   Total
                --------  ----------    -----    --------  ----------   -----

Net revenues     $ 142,893 $ 459,498 $ 602,391 $   218,714 $  4,847 $ 223,561
Cost of sales       84,694   292,844   377,538     118,212    7,126   125,338

General and
 administrative    535,169   136,979   672,148     559,950   31,175   591,125
Selling             46,096    44,071    90,167      37,636   58,276    95,912
Research and
 development        11,302        16    11,318      25,540    4,486    30,026
Impairment of
goodwill/Intangibles     -         -         -   1,191,967        - 1,191,967
Interest income         49     5,980     6,029           -        -         -
Interest expense    11,589     3,850    15,439   1,413,206        - 1,413,206
Loss on disposal of
 assets                  9         -         9           -        -         -
Income tax benefit
 (expense)               -         -         -           -        -         -
                   _______   _______  _______  __________  _______  _________
Net Income (loss)$(545,917)$(12,282)$(558,199)$(3,127,797)$(96,216)(3,224,013)
                   _______   _______  _______  __________  _______  _________

<PAGE>
         WIZZARD SOFTWARE CORPORATION AND SUBSIDIARIES
      NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 14 - SUBSEQUENT EVENT

On April 10, 2006, the Company issued 88,321 common shares upon conversion of
$125,000 of the convertible note payable and payment of related accrued
interest payable of $7,482.

On April 20, 2006, the Company issued 44,000 common shares to employees and
non-employees for services rendered.

During May 2006, the Company issued 200,000 shares of common stock to the
holders of the 5% notes payables to extend the maturity date of the 5% notes
payables to December 28, 2006.

During May 2006, the Company recorded a $140,000 expense for the re-pricing of
466,668 warrants to purchase common stock from an exercise price of $1.50
per share reduced to $1.20 per share.  The warrants were immediately
exercised.

On May 9, 2006, the Company granted warrants to purchase 466,668 shares of
common stock at $2.50 per share, expiring May 9, 2009.  The warrants were
granted in connection with a private placement.
<PAGE>
 Item 2.   Management's Discussion and Analysis or Plan of Operation.
            ----------------------------------------------------------

Highlights of First Quarter, 2006.
--------------------------------

In the first quarter of 2006, Wizzard Software Corporation made several
significant accomplishments and successfully moved forward on many aspects
of our business plan.  Some of these accomplishments broken down by internal
business group include:

2006 Q1 Speech Technology & Services Group

Wizzard Software's Speech Technology & Services Group sells and licenses
speech programming tools, related speech products and services, and
distributable speech engines in over 13 languages worldwide.  Wizzard receives
the majority of its sales leads through arrangements with IBM and AT&T as well
as through internal internet marketing efforts with Google, Yahoo and other
major internet search engines.

The Technology & Services Group (T&S Group) is a cross divisional team within
Wizzard that consists of the Technology and Services Division (T&S), plus
key members of Wizzard's development, MIS, and marketing groups. Together,
we are working to implement our strategy to increase market share and brand
awareness and become the preferred supplier of speech technologies and
services for both domestic and international business developers. The Group
plans to increase overall revenue by significantly expanding its customer
base, product portfolio and customer reach through a continued focus on
three imperatives: best technologies; best pricing; and responsive support.

Some of the highlights for the Speech Technology & Services Group for the
first quarter of 2006 include:

       * Provided Thomson Higher Education with AT&T Natural Voices TTS for
         MP3 Format Textbooks

       * Expanded Distribution Agreement with IBM to Include Asia Pacific
         Region

       * Wizzard Customer, e-Spindle Learning Inc., Wins Parents' Choice Award
         for Online Spelling Tutor

       * Provided GAI-Tronics with AT&T Natural Voices for Call Management
         System

       * Customer Evolve's Training Software Achieves Greater Than 98%
         Accuracy Rate with IBM ViaVoice

       * Grew regular royalty reporting instances from existing customer base
         by 30% Quarter over Quarter

       * Maintained high level of "new" contract activity in a highly
         competitive environment

       * Added a number of potentially large dictation and TTS port licensing
         prospects


T&S Group added new assistive application and alert/broadcast customers in
the first quarter of 2006. Alert/broadcasting is an emerging customer
category which began to take shape as a significant opportunity in 2005. In
addition, T&S is continuing to focus on our core ATM, simulator and medical
dictation markets, and is expanding the protocol supportive attributes of
our TTS telephony offerings based on customer requests for larger, IVR-type
applications.

Over the course of the first quarter our Speech Technology and Services
Group helped many companies add speech technology to their products or
services through our speech programming tools and consulting services.  The
number of quarterly royalty reporting customers is growing each quarter and
we have several customers who have the potential to require large volume
licenses in the coming quarters.  Recently, there have been substantial
consolidation and workforce shifts in the speech industry and management
believes these events have created opportunity for our Speech Technology and
Services Group to capture new, high volume telephony server customers
specifically, while at the same time reducing the number of high quality
product choices on the market.  We continue to see interest in our products
and services from industry segments such as emergency alerts, e-books, pod
casting, telephony IVR and the healthcare market, while we maintain internet
marketing efforts on Google, Yahoo and Apple websites.  Our speech offerings
continue to make an impact in the assistive and education categories. Many
leading developers of assistive and educational products have repeatedly
chosen Wizzard as their source for text-to-speech technology. Higher
Education and commercial offerings are using speech technology to provide
accessibility of text books and learning materials to impaired students. The
increase in large, high profile customer adoption of our products, combined
with the new, improved speech technology coming from our partners, plus the
growing acceptance of enabling technologies like VoIP, wi-fi and pod
casting, we remain very optimistic regarding the future of our Speech
Technology & Services business.

2006 Q1 Speech Products Group

The objectives for the Speech Product Group is to establish successful sales
channels for select products offered directly by the Company which
incorporate speech technology offered through our Technology and Services
Group.

The newest Wizzard offering, WizzTones, was released in mid-January and
garnered a significant amount of press.  To promote the product, we
announced the release on Business Wire and placed the trial version on
multiple download websites.  We were also able to secure a listing on the
Skype site.  In March, we created a Google AdWords campaign for WizzTones
and almost immediately the number of visitors to the site tripled.
Management believes that once the Skype/Warner Brothers Music deal,
previously announced by Skype, is finally launched, the number of Skype
users (currently estimated at 100M) that want to have multiple music
ringtones will grow exponentially.  At this time, WizzTones is the only
option for users that want to have specific ringtones designated for
specific callers.

Branded with the name "Rex," the Talking Prescription Bottle allows end-
users to "hear" medication instructions when reading a medication label is
not practical or possible.  There are several billion prescriptions filled
each year in the U.S. and pharmaceutical errors create billions of dollars
in additional medical spending with the number one error being identified as
labeling problems and education. Using unique microprocessor electronics and
Wizzard's advanced text-to-speech technology, pharmacists automatically
create a "talking" label while the traditional instruction label is being
printed. At the push of a button, the prescription bottle talks to the
patient, telling him or her the name of the medication, the dosage the
patient should consume, the frequency of administration, refill
instructions, warnings and other important information necessary to educate
and help people take their prescription medication properly.

Our MedivoxRx Talking Prescription Bottle business is making positive
progress.  The Speech Products Group is focusing its marketing efforts on
retail pharmacies and caregivers and is working hard towards getting
Medicare reimbursement and insurance coverage for our Talking Prescription
Bottle customers. While there are no guarantees of approval, management
believes reimbursement approval from Medicare and insurance companies is the
key to large unit sales. We are in the process of collecting clinical data
from independent third party studies for our product to provide to
governmental and insurance agencies.  Some of the highlights from the 1st Q
include:

       * MedivoxRx Added to HealthCare Purchasing Partners International's 340
         Prime Vendor Program for Low-Income Americans

       * MedivoxRx executive testified before the State of Maryland Ways and
         Means Committee for Rex

       * MedivoxRx executive meets with Assemblymen from New York State to
         initiate legislation for Rex

       * MedivoxRx executive meets with Senator Clinton's staff to discuss VA
         adoption of Rex

       * Signed an agreement with HPPI for the distribution of Rex.  HPPI is
         the Prime Vendor for the Section 340B program

       * Two Large nationwide chains commit to Rex pilot programs

       * Closed a deal with Canadian firm as the first step to Canada wide
         distribution

       * Received replenishment orders for various VA Hospital locations

       * Signed Griffin Hospital in Connecticut to carry Rex

       * Signed Arkansas School for the Blind and received second order from
         Delaware Association for the Blind

       In the first quarter, we continued to make progress in our negotiations
with a number of national retail pharmacies and expand our direct marketing
efforts to select doctors, medical and assistive living facilities.  As with
most new technology products, the adoption cycle sometimes takes longer than
anticipated but with the sales channel and end user reactions we are
experiencing, we remain steadfast in our beliefs that the Talking
Prescription Bottle has the potential to be a big success for Wizzard.

       We plan to continue to work with legislators in several states that
support legislation requiring pharmacies to carry assistive aid devices that
help ensure patient safety.  We have received attention and support from
members of Congress at the Federal and State levels in conjunction with the
proposed legislation in Maryland as well as use of the product in federally
funded programs.

       With the positive sales channel, end user and legislator reactions that
we are receiving, we remain committed to our belief that the Talking
Prescription Bottle will begin to achieve the success in 2006 that we have
envisioned from the onset.  We expect to make several announcements in the
near future which should demonstrate progress on our plan to grow bottle
sales.

2006 Q1 Speech Services - Healthcare

       Our acquisition of Interim Healthcare of Wyoming was completed in the
third quarter of 2005 and we continue to be excited about the impact our
speech technology can have on the home healthcare industry.  Based in
Casper, Wyoming, Interim Health Care of Wyoming has been serving its
community for thirteen years and is part of the fast growing home health
segment of the healthcare industry, providing a wide range of visiting nurse
services to the elderly, wounded and sick. It is one of the 300 home health
agencies that comprise Interim Health Care, the largest home healthcare
franchise in the U.S.

       We believe that our speech technology (Talking Prescription Bottle,
WizzScribe transcription service, MedOasis InfoPath forms, ViaVoice speech
medical recognition, etc.) can make a significant impact on the bottom line
of HHC agencies and we are aggressively working towards our first speech
implementation.  Both Wizzard's management and owners of our targeted home
health care agencies believe that strong synergies exist among the services
they offer, the compliances they must adhere to, the job functions of their
workers and our Talking Prescription Bottle, various talking medical
devices, WizzScribe transcription product, medical speech recognition
dictation and form-fill applications. Currently, most nurses and health
aides fill out mandatory paperwork by hand while owners of the home
healthcare agencies continuously strive for timely and accurate data.  With
a 10% to 25% rejection rate, and 25% to 50% of a worker's time spent filling
out paperwork, having the ability to quickly collect and submit accurate
data for payment forms and other aspects of the home healthcare business is
a compelling proposition.  We believe that voice is the most efficient,
accurate method for entering and retaining medical records in this thriving
vertical market with almost no competition for us in speech technology
implementations.  We're starting with the telephone as the interface device
because everyone is comfortable with it and this allows us to accurately
capture data at the point of care.  We believe we are now in position to
build the best, most affordable home health medical records solution.

Some of the highlights from the 1st Q 2006 include:

       * Increased marketing activities to local assisted living facilities
         and the senior centers

       * Participated in health fair in Casper to gain referral sources

       * Staff recruitment at local career fair

       * Updated marketing materials

       * Began radio advertising program

       * Wyoming State Legislature passed a bill which gives home health
         providers increased reimbursement

       * Began working with local QIO promoting and adopting new protocols for
         telemedicine

       * Saw increased demand for telemedicine in Q1

2006 Q1 MANAGEMENT CONCLUSION

Management believes that all three of our internal business groups made
positive progress on our business plan in the first quarter of 2006.  Our
Speech Technology & Services Group increased their sales territory for IBM
products to include the Asia Pacific region.  Our Speech Products Group had
two major nationwide retailers agree to pilot programs for Rex - The Talking
Prescription Bottle.  And, the Wyoming State Legislature passed a bill which
gives home health providers increased reimbursement, which should directly
benefit our Wyoming based home healthcare business.  While we still have a
lot of work ahead of us to grow our respective businesses, we believe these
three key accomplishments have the potential to positively impact our
business in 2006.

Results of Operations.
----------------------

Three Months Ended March 31, 2006 and 2005.
-----------------------------------------------

During the first three months ended March 31, 2006, Wizzard recorded total
net revenues of $602,391, a 169% increase from total net revenues of
$223,561 in the first quarter of 2005.  The increase for the first quarter
of 2006 was due to the addition of $459,498 in revenue from our acquisition
of Interim Healthcare of Wyoming.  Net revenues from our speech recognition
operations were $142,893 in the first quarter of 2006, representing a
decrease of approximately 35% over net revenues of $218,714 in the first
quarter of 2005.  This decrease was the result of an exceptionally strong
fourth quarter in 2005.

Cost of goods sold totaled $377,538 in the first quarter of 2006, versus
$125,338 in the first quarter of 2005.  This increase of 201% is attributed
to the cost of sales associated with Interim Healthcare of Wyoming, which
totaled $283,286 in the first quarter of 2006.  Cost of sales associated
with our speech recognition operations declined to $84,694 in the first
quarter of 2006, as compared to $118,212 in the prior year quarter.  This
decrease was due primarily to the decrease in sales activity during the
first quarter of 2006.  Wizzard posted a gross profit of $224,853 during the
first quarter of 2006, representing an increase of approximately 129% over
gross profit of $98,223 in the first quarter of 2005.

In the first three months ended March 31, 2006, operating expenses totaled
$773,633, which was a 59% decrease from operating expenses of $1,909,030 in
the first quarter of 2005.  Broken down by line item our operating expenses
were:  General and administrative expenses were $672,148 in 2006 versus
$450,125 in 2005.  The increase in general and administrative expenses was
primarily due to the addition of Interim Healthcare of Wyoming, Inc.
Selling expenses in the first quarter of 2006 were $90,167, versus $95,912
in 2005.  Research and Development expenses in the first quarter were
$11,318 as compared to $30,026 in 2005.  Non-cash investor relations
services in the first quarter of 2006 were $0 versus $141,000 in 2005.  The
decrease in operating expenses was due to the recording of Impairment of
Goodwill in the first quarter of 2005, totaling $1,191,967.

Other expenses consisted of an interest expense of $15,439 in the first
quarter of 2006, versus $1,413,206 in the first quarter of 2005.  This
decrease relates to the issuance of a $1,400,000 unsecured convertible note
payable during the first quarter of 2005, interest payment on $250,000
assumed in the acquisition of Interim Healthcare of Wyoming, Inc., and
penalties on the delay in registering the underlying securities.

Wizzard's net loss was $558,199, or $0.02 per share, in the first three
months ended March 31, 2006.  This represents an approximately 83% decrease
from our net loss of $3,224,013, or $0.12 per share, in the first quarter of
2005.

Liquidity and Capital Resources.
--------------------------------

Cash on hand was $287,523 at March 31, 2006.  Cash used in operations for
the three months ended March 31, 2006, was $332,379, an increase of 58% over
the $210,709 cash used in operations for the three months ended March 30,
2005.  Cash used in financing activities was $248,158 during the three
months ended March 31, 2006, an increase of 116% over the $1,521,150 cash
provided by investing activities during the three months ended March 31,
2005.  For the three months ended March 31, 2006, we paid off a note payable
totaling $239,576.  For the three months ended March 31, 2005, we received
$1,400,000 when we closed a 5% convertible not subscription agreement and
$146,226 in proceeds from the exercise of warrants, and paid $25,076 in
notes payable to a related party.

The Company used common stock to pay $254,989 in consulting services during
the three months ended March 31, 2006. In doing so, management believes we
have conserved Wizzard's cash liquidity for operational purposes.

The Company believes it is still in the early stages of the new and
developing speech technology market and estimates it will require
approximately $130,000 per month to maintain current operations.  The
Company has been successful over the past nine years in obtaining working
capital and will continue to seek to raise additional capital from time to
time as needed and until profitable operations can be established.

Safe Harbor Statement.
----------------------

Statements made in this Form 10-QSB which are not purely historical are
forward-looking statements with respect to the goals, plan objectives,
intentions, expectations, financial condition, results of operations, future
performance and business of the Company, including, without limitation, (i)
our ability to gain a larger share of the speech recognition software
industry, our ability to continue to develop products acceptable to that
industry, our ability to retain our business relationships, and our ability
to raise capital and the growth of the speech recognition software industry,
and (ii) statements preceded by, followed by or that include the words
"may", "would", "could", "should", "expects", "projects", "anticipates",
"believes", "estimates", "plans", "intends", "targets", "tend" or similar
expressions.

Forward-looking statements involve inherent risks and uncertainties, and
important factors (many of which are beyond the Company's control) that
could cause actual results to differ materially from those set forth in the
forward-looking statements, including the following, in addition to those
contained in the Company's reports on file with the Securities and Exchange
Commission: general economic or industry conditions, nationally and/or in
the communities in which the Company conducts business, changes in the
interest rate environment, legislation or regulatory requirements,
conditions of the securities markets, changes in the speech recognition
technology industry, the development of products that may be superior to the
products offered by the Company, competition, changes in the quality or
composition of the Company's products, our ability to develop new products,
our ability to raise capital, changes in accounting principals, policies or
guidelines, financial or political instability, acts of war or terrorism,
other economic, competitive, governmental, regulatory and technical factors
affecting the Company's operations, products, services and prices.

Accordingly, results actually achieved may differ materially from expected
results in these statements.  Forward-looking statements speak only as of
the date they are made.  The Company does not undertake, and specifically
disclaims, any obligation to update any forward-looking statements to
reflect events or circumstances occurring after the date of such statements.

Item 3.  Controls and Procedures.
         ------------------------

In connection with the completion of its audit of, and the issuance of its
report on our consolidated financial statements for the year ended December
31, 2005, Gregory & Eldredge, LLC identified deficiencies that existed in
the design or operation of our internal control over financial reporting
that it considered to be "material weaknesses."  The Public Company
Accounting Oversight Board had defined a material weakness as a "significant
deficiency or combination of significant deficiencies that results in more
than a remote likelihood that a material misstatement of the annual or
interim financial statements will not be prevented or detected."

The material weakness identified relate to:

  * the lack of sufficient knowledge and experience among the internal
    accounting personnel regarding the application of US GAAP and SEC
    requirements;

  * insufficient written policies and procedures for accounting and financial
    reporting with respect to the current requirements and application of US
    GAAP and SEC disclosure requirements; and

  * segregation of duties, in that we had only one person performing all
    accounting-related duties

We believe that each of these material weaknesses existed at December 31,
2005.  The following changes in our internal controls over financial
reporting occurred during the first quarter of 2006 (unless indicated
otherwise):

  * In the first quarter of 2005, we updated and added 10 new modules to our
    internal workflow system to cover e-commerce credit card processing,
    purchase order streamlining, order entry and customer payment scheduling.
    During the second quarter, we added two new modules to this system for a
    total of twelve through June 30, 2005. This system has already made our
    workers more efficient and management believes that as we continue to
    improve the processes and procedures of the system our employees will
    continue to increase their productivity while at the same time the
    Company's controls and oversights will improve for better compliance with
    Sarbanes-Oxley regulations.  This system provides a platform for us to
    determine where we should undertake additional segregation of duties among
    our employees and for determining how we can otherwise improve our
    disclosure controls and procedures; and

  * the hiring of John L. Busshaus as our Controller on April 3, 2006, and the
    education of Christopher J. Spencer and Armen Geronian and our accounting
    staff about GAAP and Securities and Exchange Commission requirements;

  * the segregation of accounting duties that had formerly been performed by
    one person among three persons, including Mr. Busshaus.  As we continue to
    incorporate written policies and procedures for accounting and financial
    reporting, we will continue to implement additional segregation of duties.

We believe that these steps have fully addressed the first material weakness
identified above.  We are actively working on implementing written policies
and procedures that will fully address the second material weakness, which
we also believe still exists.  We expect that this process may take 9-12
months.  As we continue to refine our internal workflow system and our
written policies and procedures, we believe that we will identify other
areas in which we can further segregate our employees' duties.  Although we
have taken significant steps to address this material weakness, we believe
that it will continue to exist until we have fully addressed the written
policies and procedures material weakness.

During the next 9-12 months, we expect to retain outside consultants to
advise us and test our Sarbanes-Oxley compliance.  We expect that the cost
of these consultants will be approximately $50,000.

As required by Rule 13a-15(b) of the Securities and Exchange Commission, and
as of the end of the period covered by this Report, we carried out an
evaluation under the supervision and with the participation of our
management, including our Chief Executive Officer and acting Chief Financial
Officer, or the persons performing similar functions, of the effectiveness
of the design and operation of our disclosure controls and procedures as of
March 31, 2006.  Based on this evaluation, our President/Treasurer has
concluded that the Company's controls and procedures as of March 31, 2006,
are not effective. This is management's conclusion, despite the compensating
control provided by the significant day-to-day involvement of the Company's
Chief Executive Officer in all aspects of the Company's operations in a
small company atmosphere, and the Company's engagement of an outside
professional with sufficient expertise in the application of US GAAP and SEC
requirements.

The significant day-to-day involvement of our Chief Executive Officer
includes:

  * his approval of all new hires and all Company purchases over the amount of
    $500;

  * the requirement that all checks over the amount of $2,500 bear two
    signatures, one of which must be an Officer's signature;

  * his approval of all transactions requiring credit approval; and

  * his involvement in the analysis and approval of all acquisitions and
    dispositions of assets.

These policies have been in place since Wizzard's inception.

The outside accounting professional was engaged during the first quarter of
2006 to advise the Company in the preparation of its financial statements
and Form 10-KSB for the calendar year ended December 31, 2005.  This outside
professional has significant expertise in the application of US GAAP and
Securities and Exchange Commission requirements, which has compensated for
the lack of such expertise within the Company prior to hiring Mr. Busshaus
as our Controller, as discussed above.  The fees for the outside
professional's services have totaled approximately $825 for these services.
This professional is not associated with our independent public accounting
firm.

The Company will continue to monitor, assess and work to improve the
effectiveness of our internal control procedures related to internal
controls, financial reporting and certain entity-wide controls related to
corporate governance in order to comply with Section 404 of the Sarbanes
Oxley Act of 2002.

                     PART II - OTHER INFORMATION

Item 1.   Legal Proceedings.
          ------------------

       None; not applicable.

Item 2.   Unregistered Sales of Equity Securities and Use of Proceeds.
----------------------------------------------------------------------

The following table provides information about all "unregistered" and
"restricted" securities that Wizzard has sold during the three month period
ended March 31, 2006, which were not registered under the Securities Act of
1933, as amended (the "Securities Act"):

          Name          Date       Shares           Amount
------------------  ------------ ----------   -------------------------------
  Lane Ventures        1/9/06      100,000    Services valued
                                              at $180,000

  Bruce Phifer        1/23/06        7,500    Services valued
                                              at $13,800

(1)  We issued all of these securities to persons who were either
"accredited investors," or "sophisticated investors" who, by reason of
education, business acumen, experience or other factors, were fully capable
of evaluating the risks and merits of an investment in our company; and each
had prior access to all material information about us.  We believe that the
offer and sale of these securities were exempt from the registration
requirements of the Securities Act, pursuant to Sections 4(2) and 4(6)
thereof, and Rule 506 of Regulation D of the Securities and Exchange
Commission and from various similar state exemptions.

Item 3.   Defaults Upon Senior Securities.
          --------------------------------

       None; not applicable.

Item 4.   Submission of Matters to a Vote of Security Holders.
          ----------------------------------------------------

       None; not applicable.

Item 5.   Other Information.
          ------------------

        None; not applicable.

Item 6.   Exhibits and Reports on Form 8-K.
          ---------------------------------

  (a)  Exhibits.

       31.1 - 302 Certification of Christopher J. Spencer

       31.2 - 302 Certification of Gordon Berry

         32 - 906 Certification.

  (b)  Reports on Form 8-K.

       None; not applicable.
<PAGE>
                                 SIGNATURES

In accordance with the requirements of the Exchange Act, the Registrant
caused this Report to be signed on its behalf by the undersigned, thereunto
duly authorized.

                                           WIZZARD SOFTWARE CORPORATION

Date: 5-15-06         /s/ Christopher J. Spencer
     ---------       -----------------------------------
                     Christopher J. Spencer, Director,
                     CEO, President and Treasurer

Date: 5-15-06         /s/ Armen Geronian
     ---------       ----------------------------------
                     Armen Geronian, Director
                     Secretary

Date: 5-15-06         /s/ Gordon Berry
     ---------       ----------------------------------
                     Gordon Berry, Director and Acting
                     Chief Financial Officer

Date: 5-15-06         /s/ Alan Costilo
     ---------       ----------------------------------
                     Alan Costilo, Director