INCOME TAXES

12 Months Ended

Dec. 31, 2023

18. INCOME TAXES

For the fiscal years 2023 and 2022, there was no provision for income taxes and deferred tax assets have been entirely offset by valuation allowances.

As of December 31, 2023 and 2022, the Company had net operating loss carry forwards of approximately $4,214,489 and $3,897,793, respectively. The carry forwards expire through the year 2043. The Company’s net operating loss carry forwards may be subject to annual limitations, which could reduce or defer the utilization of the losses as a result of an ownership change as defined in Section 382 of the Internal Revenue Code.

The Tax Cuts and Jobs Act was enacted on December 22, 2017, which reduced the U.S. corporate statutory tax rate from 35% to 21% beginning on January 1, 2018. We used 21% as an effective rate. The Company’s tax expense differs from the “expected” tax expense for Federal income tax purposes (computed by applying the United States Federal tax rate of 21% to loss before taxes (2018 – 21%)), as follows:

SCHEDULE OF TAX EXPENSE

	2023			2022
	For the years ended December 31,
	2023			2022
Net operating loss before taxes	$	(5,650,103	)	$	(6,212,287	)
The federal income tax rate		21	%		21	%
Tax expense (benefit) at the statutory rate		(1,186,522	)		(1,304,580	)
Non-deductible items
Tax effect of stock-based compensation (non-qualifying options)		142,345			389,710
Change in Derivatives		-			(92,414	)
Change in the valuation allowance		1,044,177			1,007,284
Total	$	-		$	-

The tax effects of the temporary differences between reportable financial statement income and taxable income are recognized as deferred tax assets and liabilities. The tax effect of significant components of the Company’s deferred tax assets at December 31, 2023 and 2022, respectively, are as follows:

	2023			2022
Deferred tax asset:
Net operating loss carryforwards	$	4,941,970		$	3,897,793
Total gross deferred tax assets		4,941,970			3,897,793
Less: Deferred tax asset valuation allowance		(4,941,970	)		(3,897,793	)
Total net deferred tax assets	$	-		$	-

In assessing the ability to realize the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment.

The returns filed from the year 2019 going-forward are subject to examination by the IRS.

MetaWorks Platforms, Inc.

(formerly CurrencyWorks Inc.)

Notes to Consolidated Financial Statements

December 31, 2023 and 2022

(Restated)

19. NON-CONTROLLING INTEREST

On March 15, 2023, the Company signed an agreement with its partner in the jointly owned subsidiary EnderbyWorks, LLC to become the 100% owner of this entity. The agreement includes a secured promissory note receivable due to the Company by Enderby Entertainment in the amount of $1,828,000. The note receivable has an annual interest rate of 8% due on July 6, 2024. There is also a royalty clause on the existing assets that EnderbyWorks will pay the former partner 50% of the first $6,000,000 in net revenue, if revenues are generated in the future. The acquisition of the non-controlling interest in Enderby Works was received for no cash consideration and only the exchange of a note receivable due to the Company and a contingent royalty obligation owed to Enderby Entertainment by Enderby Works should it generate revenues in the future.

The reported non-controlling interest represents that in MC the Company holds 80% interest in this was business which was acquired in June 22, 2021.

The following table sets forth a summary of the changes in non-controlling interest:

	December 31, 2023			December 31, 2022
Non-controlling interest beginning of the period	$	(881,720	)		(894,742	)
Issuance of shares by EnderbyWorks, LLC		-			4,900
Net income (loss)		(14,175	)		8,122
Acquisition		734,637			-
Non-controlling interest end of period	$	(161,258	)		(881,720	)

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Name Accounting Standards Codification
-Section 50
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

WASTE ENERGY CORP. 10-K/A