PaySign (PAYS) 10-K 26 Mar 21 2020 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2020	Mar. 23, 2021	Jun. 30, 2020
Cover [Abstract]
Entity Registrant Name	Paysign, Inc.
Entity Central Index Key	0001496443
Document Type	10-K
Document Period End Date	Dec. 31, 2020
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Non-accelerated Filer
Entity Public Float			$ 297,880,651
Entity Common Stock, Shares Outstanding		50,447,432
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2020
Entity Emerging Growth	true
Entity Small Business	true
Entity Ex Transition Period	false
Entity File Number	001-38623
State of Incorporation	NV
Interactive data current?	Yes
Entity a Well-known Seasoned Issuer	No
Entity a Voluntary Filer	No
Entity Shell Company	false
Attestation Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Current assets
Cash	$ 7,829,453	$ 9,663,746
Restricted Cash	48,100,951	35,908,559
Accounts Receivable	654,859	891,936
Prepaid expenses and other assets	1,375,364	1,413,208
Total current assets	57,960,627	47,877,449
Fixed assets, net	1,849,164	937,185
Intangible assets, net	3,699,033	3,816,232
Operating lease right-of-use asset	4,324,682	0
Deferred tax asset	0	917,480
Total assets	67,833,506	53,548,346
Current liabilities
Accounts payable and accrued liabilities	2,162,256	1,523,604
Operating lease, current portion	320,636	0
Customer card funding	48,100,951	32,723,227
Total current liabilities	50,583,843	34,246,831
Operating lease liability, long term portion	4,013,598	0
Total liabilities	54,597,441	34,246,831
Stockholders' equity
Preferred stock: $0.001 par value; 25,000,000 shares authorized; none issued and outstanding	0	0
Common stock; $0.001 par value; 150,000,000 shares authorized, 50,251,607 and 48,577,712 issued at December 31, 2020 and 2019, respectively	50,252	48,578
Additional paid-in capital	14,388,890	11,577,539
Treasury stock at cost, 303,450 shares	(150,000)	(150,000)
Retained earnings (accumulated deficit)	(1,053,077)	8,088,485
Total Paysign, Inc. stockholders' equity	13,236,065	19,564,602
Noncontrolling interest	0	(263,087)
Total stockholders' equity	13,236,065	19,301,515
Total liabilities and stockholders' equity	$ 67,833,506	$ 53,548,346

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Common stock, par value	$ .001	$ 0.001
Common stock, shares authorized	150,000,000	150,000,000
Common stock, shares issued	50,251,607	48,577,712
Treasury stock shares	303,450	303,450
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	25,000,000	25,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Revenues	$ 24,120,434	$ 34,666,653
Cost of revenues	14,817,028	15,425,178
Gross profit	9,303,406	19,241,475
Operating expenses
Selling, general and administrative	15,091,432	11,656,681
Impairment of intangible asset	382,414	0
Loss on abandonment of assets	42,898	0
Depreciation and amortization	2,124,762	1,483,140
Total operating expenses	17,641,506	13,139,821
Income (loss) from operations	(8,338,100)	6,101,654
Other income
Interest income	90,720	441,116
Income (loss) before income tax provision (benefit) and noncontrolling interest	(8,247,380)	6,542,770
Income tax provision (benefit)	894,182	(909,976)
Net income (loss) before noncontrolling interest	(9,141,562)	7,452,746
Net loss attributable to noncontrolling interest	0	1,573
Net income (loss) attributable to Paysign, Inc.	$ (9,141,562)	$ 7,454,319
Net income (loss) per share
Basic	$ (0.19)	$ 0.16
Diluted	$ (0.19)	$ 0.14
Weighted average common shares
Basic	49,272,494	47,436,754
Diluted	49,272,494	54,550,369
Plasma Industry [Member]
Revenues	$ 23,401,068	$ 26,994,929
Pharma industry [Member]
Revenues	326,699	7,372,990
Other [Member]
Revenues	$ 392,667	$ 298,734

CONSOLIDATED STATEMENTS OF STOC

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($)	Common Stock	Additional Paid-In Capital	Treasury Stock	Retained Earnings / Accumulated Deficit	Noncontrolling Interest	Total
Beginning balance, shares at Dec. 31, 2018	46,440,765
Beginning balance, value at Dec. 31, 2018	$ 46,441	$ 8,620,144	$ (150,000)	$ 579,582	$ (206,930)	$ 8,889,237
Exercise of stock options, shares	245,800
Exercise of stock options, value	$ 246	430,673				430,919
Issuance of stock for previously vested stock-based compensation, shares	1,891,147
Issuance of stock for previously vested stock-based compensation, value	$ 1,891	(1,891)
Stock-based compensation		2,528,613				2,528,613
Dissolution and amalgamation of Qfour, Inc. subsidiary				54,584	(54,584)
Net income (loss)				7,454,319	(1,573)	7,452,746
Ending balance, shares at Dec. 31, 2019	48,577,712
Ending balance, value at Dec. 31, 2019	$ 48,578	11,577,539	(150,000)	8,088,485	(263,087)	19,301,515
Exercise of stock options, shares	71,900
Exercise of stock options, value	$ 72	172,488				172,560
Issuance of stock for previously vested stock-based compensation, shares	1,581,995
Issuance of stock for previously vested stock-based compensation, value	$ 1,582	(1,582)
Stock-based compensation		2,971,777				2,971,777
Dissolution of Paysign, Ltd. Subsidiary		(263,087)			263,087
Repurchase of employee common stock for taxes withheld		(245,425)				(245,425)
Issuance of stock for acquisition of contract assets, shares	20,000
Issuance of stock for acquisition of contract assets, value	$ 20	177,180				177,200
Net income (loss)				(9,141,562)		(9,141,562)
Ending balance, shares at Dec. 31, 2020	50,251,607
Ending balance, value at Dec. 31, 2020	$ 50,252	$ 14,388,890	$ (150,000)	$ (1,053,077)		$ 13,236,065

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Cash flows from operating activities:
Net income (loss) attributable to Paysign, Inc.	$ (9,141,562)	$ 7,454,319
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Net loss in noncontrolling interest	0	(1,573)
Stock-based compensation	2,971,777	2,528,613
Depreciation and amortization	2,124,763	1,483,140
Impairment of intangible asset	382,414	0
Loss on abandonment of assets	42,898	0
Amortization of lease right-of-use asset	418,243	0
Deferred taxes	917,480	(909,976)
Changes in operating assets and liabilities:
Accounts receivable	237,077	(554,633)
Prepaid expenses and other current assets	(20,544)	(245,471)
Accounts payable and accrued liabilities	741,533	196,107
Operating lease	(275,984)	0
Customer card funding	15,377,724	6,762,253
Net cash provided by operating activities	13,775,819	16,712,779
Cash flows from investing activities:
Purchase of fixed assets	(1,383,311)	(463,714)
Capitalization of internally developed software	(1,880,283)	(1,492,356)
Purchase of intangible assets	(81,261)	(1,281,064)
Net cash used in investing activities	(3,344,855)	(3,237,134)
Cash flows from financing activities:
Proceeds from exercise of stock options	172,560	430,919
Repurchase of employee common stock for taxes withheld	(245,425)	0
Net cash provided by (used in) financing activities	(72,865)	430,919
Net change in cash and restricted cash	10,358,099	13,906,564
Cash and restricted cash, beginning of period	45,572,305	31,665,741
Cash and restricted cash, end of period	55,930,404	45,572,305
Non-cash financing activities
Acquisition of right-of-use asset by operating lease	4,455,271	0
Issuance of stock for asset acquisition	177,200	0
Dissolution of noncontrolling interest	$ 263,087	$ 0

RECONCILIATION OF CASH

RECONCILIATION OF CASH - USD ($)	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Additional Cash Flow Elements and Supplemental Cash Flow Information [Abstract]
Cash	$ 7,829,453	$ 9,663,746
Restricted cash	48,100,951	35,908,559
Total cash and restricted cash	$ 55,930,404	$ 45,572,305	$ 31,665,741

1. DESCRIPTION OF BUSINESS AND

1. DESCRIPTION OF BUSINESS AND HISTORY	12 Months Ended
	Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
DESCRIPTION OF BUSINESS AND HISTORY	1. Description of business AND HISTORY Paysign, Inc. (the “Company,” “Paysign,” “we” or “our”, formerly known as 3PEA International, Inc.) was incorporated on August 24, 1995 under the name of Antek International, Inc. The Company has undergone several name changes before eventually amending our articles of incorporation and changing our name from 3PEA International, Inc. to Paysign, Inc. on April 23, 2019. Additionally, we changed our trading symbol on the NASDAQ Capital Market to “PAYS.” The Company acquired 3Pea Technologies, Inc., a payment solutions company, in March 2006, which resulted in 3Pea Technologies, Inc. becoming a wholly owned subsidiary. The Company dissolved its Paysign, Ltd. Subsidiary during 2020, eliminating the related non-controlling interest. Impact of COVID-19 Pandemic The outbreak of a novel coronavirus and the incidence of the related disease (COVID-19) starting in late 2019 has continued, spreading throughout the United States and much of the world beginning in the first quarter of 2020. In March 2020, the World Health Organization declared the outbreak as a pandemic. While the disruption is currently expected to be temporary, there is uncertainty around the duration. The COVID-19 outbreak has had and will continue to have an adverse effect on the Company's results of operations. Given the uncertainty around the extent and timing of the potential future spread or mitigation of COVID-19 and around the imposition or relaxation of protective measures, management cannot reasonably estimate the impact to the Company's future results of operations, cash flows, or financial condition. New stimulus packages signed into law during 2020 have not had a material impact on the Company’s condensed consolidated financial statements. About Paysign Paysign, Inc. is a vertically integrated provider of prepaid card products and processing services for corporate, consumer and government applications. Our payment solutions are utilized by our corporate customers as a means to increase customer loyalty, increase patient adherence rates, reduce administration costs and streamline operations. Public sector organizations can utilize our payment solutions to disburse public benefits or for internal payments. The Company markets prepaid card solutions under our Paysign ® We provide a card processing platform consisting of proprietary systems and software applications based on the unique needs of our programs. We have extended our processing business capabilities through our proprietary Paysign platform. Through the Paysign platform, we provide a variety of services including transaction processing, cardholder enrollment, value loading, cardholder account management, reporting, and customer service. We design and process prepaid programs that run on the platform through which customers can define the services they wish to offer cardholders. The Paysign brand offers prepaid card solutions or “card products” for corporate incentive and rewards including, but not limited to rebates and rewards, donor compensation, clinical trials, healthcare reimbursement payments and pharmaceutical payment assistance. We have expanded our product offerings to include additional corporate incentive products and demand deposit accounts accessible with a debit card. We plan to further expand our product offerings into other prepaid card products such as payroll cards, travel cards, and expense reimbursement cards. Our cards are sponsored by our issuing bank partners. Our proprietary Paysign platform was built on modern cross-platform architecture and designed to be highly flexible, scalable and customizable. The platform’s flexibility and ease of customization has allowed us to expand our operational capabilities by facilitating our entry into new markets within the payments space. The Paysign platform delivers cost benefits and revenue building opportunities to our partners. We manage all aspects of the prepaid card lifecycle, from managing the card design and approval processes with partners and networks, to production, packaging, distribution, and personalization. We oversee inventory and security controls, renewals, lost and stolen card management and replacement. We deploy a fully staffed, in-house customer service department which utilizes bilingual customer service agents, Interactive Voice Response (IVR), and two-way short message service (SMS) messaging and text alerts.

2. SUMMARY OF SIGNIFICANT ACCOU

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	12 Months Ended
	Dec. 31, 2020
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of consolidation Year end Use of estimates Cash and cash equivalents Restricted cash Fixed assets The Company periodically evaluates whether events and circumstances have occurred that may warrant revision of the estimated useful life of fixed assets or whether the remaining balance of fixed assets should be evaluated for possible impairment. The Company uses an estimate of the related undiscounted cash flows over the remaining life of the fixed assets in measuring their recoverability. Intangible assets Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives. Internally Developed Software Costs – For computer software developed or obtained for internal use, costs that are incurred in the preliminary project and post implementation stages of software development are expensed as incurred. Costs incurred during the application and development stage are capitalized. Capitalized costs are amortized using the straight-line method over a three to five year estimated useful life, beginning in the period in which the software is available for use. Customer card funding Fair value of financial instruments We determine the fair values of our financial instruments based on the fair value hierarchy established under applicable accounting guidance which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The following describes the three-level hierarchy: Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities. Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. We currently do not have any assets or liabilities in this category. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the overall fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments for which the determination of fair value requires significant management judgment or estimation. The fair value for such assets and liabilities is generally determined using pricing models, market comparables, discounted cash flow methodologies or similar techniques that incorporate the assumptions a market participant would use in pricing the asset or liability. We currently do not have any assets or liabilities in this category. Earnings per share Income taxes We recognize and measure income tax benefits based upon a two-step model: 1) a tax position must be more likely-than-not to be sustained based solely on its technical merits in order to be recognized, and 2) the benefit is measured as the largest dollar amount of that position that is more likely-than-not to be sustained upon settlement. The difference between the benefit recognized for a position and the tax benefit claimed on a tax return is referred to as an unrecognized tax benefit. We accrue income tax related interest and penalties, if applicable, within income tax expense. We have filed consolidated tax returns whereby past subsidiary losses are used to offset tax liabilities on current profits. This approach could be challenged by the Internal Revenue Service (“IRS”) and if not accepted, may affect net income and earnings per share. Management believes that the likelihood of the IRS not accepting such filings is minimal. Revenue and expense recognition Revenue from Contracts with Customers (ASC Topic 606), The Company recognizes revenue when goods or services are transferred to customers in an amount that reflects the consideration which it expects to receive in exchange for those goods or services. In determining when and how revenue is recognized from contracts with customers, the Company performs the following five-step analysis: (i) identification of contract with customers; (ii) determination of performance obligations; (iii) measurement of the transaction price; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligations. The Company generates revenues from Plasma card programs through fees generated from cardholder fees and interchange fees. Revenues from Pharma card programs are generated through card program management fees, interchange fees, and settlement income. Plasma and Pharma card program revenues include both fixed and variable components. Our cardholder fees represent an obligation to the cardholder based on a per transaction basis and recognized at a point in time when the performance obligation is fulfilled. Card program management fees include an obligation to our card program sponsors and are generally recognized when earned on a monthly basis pursuant to the contract terms which are generally multi-year contracts. Interchange fees are earned when customer-issued cards are processed through card payment networks as the nature of our promise to the customer is that we stand ready to process transactions at the customer’s requests on a daily basis over the contract term. Since the timing and quantity of transactions to be processed by us is not determinable, we view interchange fees to comprise an obligation to stand ready to process as many transactions as the customer requests. Accordingly, the promise to stand ready is accounted for as a single series performance obligation. The company uses the right to invoice practical expedient and recognizes revenue concurrent with the processing of card transactions. Previously, settlement income from Pharma programs was recognized and recorded, after giving consideration to any revenue constraints, ratably throughout the program lifecycle based on the Company’s estimate of the unspent balances to be remaining on the card at program expiration. During 2020, the Company observed substantially different performance indicators, current trends in the industry regarding program management by third parties, and new information available in dollar loads and spending patterns compared to historical experience. As a result, the Company changed its estimate of breakage for recognizing settlement income for Pharma programs resulting in the Company constraining revenue on all Pharma programs in accordance with applicable accounting guidance. Based on the recently observed change in facts and circumstances, the Company utilizes the remote method of revenue recognition for settlement income whereby the unspent balances will be recognized as revenue at the expiration of the cards and the respective program. The Company records all revenue on a gross basis since it is the primary obligor and establishes the price in the contract arrangement with its customers. The Company is currently under no obligation for refunding any fees, and the Company does not currently have any obligations for disputed claim settlements. Given the nature of the Company’s services and contracts, it has no contract assets. Cost of revenues is comprised of transaction processing fees, data connectivity and data center expenses, network fees, bank fees, card production costs, customer service, program management, application integration setup, and sales and commission expense. Operating leases In determining the present value of lease payments at lease commencement date, the Company utilizes its incremental borrowing rate based on the information available, unless the rate implicit in the lease is readily determinable. The liability for operating leases is based on the present value of future lease payments. Operating lease expenses are recorded as rent expense, which is included within selling, general and administrative expenses, within the consolidated statements of operations and presented as operating cash outflows within the consolidated statements of cash flows. Stock-based compensation Advertising costs New accounting pronouncements In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in ASU No. 2018-13 provide clarification and modify the disclosure requirements on fair value measurement in Topic 820, Fair Value Measurement. The amendments in this ASU No. 2018-13 are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. We . In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes

3. FIXED ASSETS

3. FIXED ASSETS	12 Months Ended
	Dec. 31, 2020
Property, Plant and Equipment [Abstract]
FIXED ASSETS	3. FIXED ASSETS Fixed assets consist of the following: December 31, 2020 December 31, 2019 Equipment $ 1,888,640 $ 2,026,549 Software 200,282 180,223 Furniture and fixtures 752,212 149,684 Website costs 67,816 34,971 Leasehold improvements 203,488 52,894 3,112,438 2,444,321 Less: accumulated depreciation 1,263,274 1,507,136 Fixed assets, net $ 1,849,164 $ 937,185 Depreciation expense for the year ended December 31, 2020 and 2019 was $428,434 and $410,019, respectively. During the year ended December 31, 2020, the Company relocated its corporate headquarters and recognized a $42,898 loss on abandonment of assets primarily related to leasehold improvements.

4. INTANGIBLE ASSETS

4. INTANGIBLE ASSETS	12 Months Ended
	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
INTANGIBLE ASSETS	4. INTANGIBLE ASSETS Intangible assets consist of the following: December 31, December 31, Patents and trademarks $ 38,186 $ 39,053 Platform 7,478,419 5,598,136 Customer lists and contracts 1,177,200 1,177,200 Kiosk development – 64,802 Licenses 234,282 534,569 8,928,087 7,413,760 Less: accumulated amortization 5,229,054 3,597,528 Intangible assets, net $ 3,699,033 $ 3,816,232 Intangible assets are amortized over their useful lives ranging from periods of 3 to 5 years. Amortization expense for the year ended December 31, 2020 and 2019 was $1,696,329 and $1,073,121, respectively. During 2020, the Company reviewed the carrying value of acquisition costs related to a business license and determined that there was an impairment necessary due to the fact that the efforts to acquire the license had been suspended. As the impairment was deemed other than temporary, an impairment of $382,414 was recorded during the third quarter of 2020. During the year ended December 31, 2019, we acquired customer lists and contracts from a third party totaling $1,177,200, which is being amortized over a period of 3 to 5 years. Estimated future amortization expense is as follows: 2021 $ 1,637,130 2022 1,170,935 2023 583,438 2024 224,192 2025 8,986 Thereafter 74,352 Total amortization expense $ 3,699,033

5. LEASE

5. LEASE	12 Months Ended
	Dec. 31, 2020
Leases [Abstract]
LEASE	5. LEASE The Company entered into an operating lease for an office space which became effective in June 2020 when the construction was complete and we were given access to occupy the space. The lease term is 10 years from the effective date and allows for two optional extensions of five years each. The two optional extensions are not recognized as part of the right-of-use asset or lease liability since it is not reasonably certain that the Company will extend this lease. As of December 31, 2020, the remaining lease term was 10 years and the discount rate was 6%. The lease for our previous office space was accounted for as a short-term lease. Operating lease cost included in selling, general and administrative expenses was $489,104 for the year ended December 31, 2020. Short-term lease cost included in selling, general and administrative expense was $94,906 and $223,847 for the year ended December 31, 2020 and 2019, respectively. The following is the lease maturity analysis of our operating lease as of December 31, 2020: Twelve months ending December 31, 2021 $ 571,968 2022 571,968 2023 571,968 2024 571,968 2025 612,006 Thereafter 2,829,335 Total lease payments 5,729,213 Less: Imputed interest 1,394,979 Present value of future lease payments 4,334,234 Less: current portion of lease liability (320,636 ) Long-term portion of lease liability $ 4,013,598

6. CUSTOMER CARD FUNDING LIABIL

6. CUSTOMER CARD FUNDING LIABILITY	12 Months Ended
	Dec. 31, 2020
Contract with Customer, Liability [Abstract]
CUSTOMER CARD FUNDING LIABILITY	6. CUSTOMER CARD FUNDING LIABILITY The Company issues prepaid cards with various provisions for cardholder fees or expiration. Revenue generated from cardholder fees and interchange fees are recognized when the Company's performance obligation is fulfilled. Unspent balances left on Pharma cards are recognized as settlement income at the expiration of the cards and the program (Note 2). Contract liabilities related to prepaid cards represent funds on card and client funds held to be loaded to card before the amounts are ultimately spent by the cardholders or recognized as revenue by the Company. Contract liabilities related to prepaid cards are reported as Customer card funding liability on the consolidated balance sheet. The opening and closing balances of the Company's contract liabilities are as follows: Year Ended December 31, 2020 2019 Beginning balance $ 32,723,227 $ 25,960,974 Increase (decrease), net 15,377,724 6,762,253 Ending balance $ 48,100,951 $ 32,723,227 The amount of revenue recognized during the years ended December 31, 2020 and 2019 that was included in the opening contract liability for prepaid cards was $844,514 and $818,889, respectively.

7. COMMON STOCK

7. COMMON STOCK	12 Months Ended
	Dec. 31, 2020
Equity [Abstract]
COMMON STOCK	7. COMMON STOCK At December 31, 2020, the Company’s authorized capital stock was 150,000,000 shares of common stock, par value $0.001 per share, and 25,000,000 shares of preferred stock, par value $0.001 per share. On that date, the Company had issued 50,251,607 shares of common stock, and no shares of preferred stock outstanding. In 2019, the Company’s shareholders approved the 3Pea International, Inc. 2018 Incentive Compensation Plan (the “2018 Plan”), which was approved by the board of directors on July 18, 2018. The Plan permits the Company to issue awards or options to the officers, directors, employees, consultants and other persons who provide services to our company or any related entity. Pursuant to the 2018 Plan, 5,000,000 shares of the Company’s common stock are reserved for issuance. Any awards or options that are not settled in shares of common stock are not counted against the limit. Stock options granted under the 2018 Plan generally vest over four or five years and expire in ten years. Stock awards granted under the 2018 Plan generally vest over four of five years. In general, if an employee is terminated, any unvested options or awards as of the date of termination will be forfeited. As of December 31, 2020, there were 3,478,533 shares available for future grants under the 2018 Plan. The Company issues new shares of common stock upon exercise of stock options or vesting stock awards. Stock-based compensation expense for the years ended December 31, 2020 and 2019 was $2,971,777 and $2,528,613, respectively, and is included in selling, general and administrative expense. As of December 31, 2020, the Company’s unrecognized stock-based compensation expense related to stock options and stock awards was $2,722,518 and $5,117,179, respectively, which are expected to be recognized over a weighted-average period of 2.60 year for stock options and 3.45 years for stock awards. 2020 Transactions: · 71,900 shares of common stock were issued related to the exercise of vested stock options and received cash proceeds totaling $172,560. · 1,581,995 shares of common stock were issued for vested stock awards to employees. · 20,000 shares of common stock were issued for an asset acquisition. 2019 Transactions: · 245,800 shares of common stock were issued related to the exercise of vested stock options and received cash proceeds totaling $430,919. · 1,891,147 shares of common stock were issued for vested stock awards to employees. Stock Options A summary of stock options activity for the years ended December 31, 2020 and 2019 is presented as follows: Weighted- Weighted- Average Average Remaining Aggregate Exercise Contractual Intrinsic Shares Price Term (Years) Value Outstanding at December 31, 2018 2,707,327 $ 2.00 Granted – – Exercised (245,800 ) 1.75 Forfeited/expired (57,727 ) 2.40 Outstanding at December 31, 2019 2,403,800 $ 2.01 8.45 $ 19,565,450 Granted 500,000 3.87 Exercised (71,900 ) 2.40 Forfeited/expired (144,200 ) 2.91 Outstanding at December 31, 2020 2,687,700 $ 2.30 7.74 $ 6,294,948 Exercisable at December 31, 2020 896,100 $ 1.91 7.42 $ 2,445,264 A summary of unvested options activity for the years ended December 31, 2020 and 2019 was as follows: Weighted- Average Grant Date Shares Fair Value Unvested at December 31, 2018 2,707,327 $ 2.00 Granted – – Forfeited/expired (57,727 ) 2.40 Vested (610,200 ) 1.91 Unvested at December 31, 2019 2,039,400 $ 2.01 Granted 500,000 3.87 Forfeited/expired (144,200 ) 2.91 Vested (603,600 ) 1.91 Unvested at December 31, 2020 1,791,600 $ 2.49 The weighted average grant date fair value of options granted and the total intrinsic value of options exercised for the years ended December 31, 2020 and 2019 is as follows: 2020 2019 Weighted average grant date fair value of options granted $ 2.86 $ – Intrinsic value of options exercised $ 370,764 $ 2,605,923 The Company uses the Black-Scholes option pricing model to estimate the fair value and compensation cost associated with employee stock options, which requires the consideration of historical employee exercise behavior, the volatility of the Company’s stock price, the weighted-average risk-free interest rate and the weighted-average expected life of the options. Forfeitures are included when they are incurred. Any changes in these assumptions may materially affect the estimated fair value of the share-based award. The weighted-average assumptions used in the Black-Scholes option-pricing model for the year ended December 31, 2020 was a risk-free interest rate of 0.38% consistent with the expected term of the options, expected volatility of 100% based on the historical actual volatility of the Company’s stock, dividend yield of -0- as the Company has no history of paying dividends and the weighted-average expected life of 5 years. Stock Awards A summary of stock awards activity for the years ended December 31, 2020 and 2019 was as follows: Weighted- Average Grant Shares Date Fair Value Outstanding at December 31, 2018 5,795,000 $ 0.94 Granted 576,147 9.50 Forfeited (170,000 ) 4.47 Vested (1,801,147 ) 0.68 Outstanding at December 31, 2019 4,400,000 $ 2.06 Granted 254,747 7.80 Forfeited (792,500 ) 4.61 Vested (1,629,558 ) 0.89 Outstanding at December 31, 2020 2,232,689 $ 2.70

8. BASIC AND FULLY DILUTED NET

8. BASIC AND FULLY DILUTED NET INCOME (LOSS) PER COMMON SHARE	12 Months Ended
	Dec. 31, 2020
Earnings Per Share [Abstract]
BASIC AND FULLY DILUTED NET INCOME (LOSS) PER COMMON SHARE	8. BASIC AND FULLY DILUTED NET INCOME (LOSS) PER COMMON SHARE The following table sets forth the computation of basic and fully diluted net income (loss) per common share for the years ended December 31, 2020 and 2019: 2020 2019 Numerator: Net income (loss) attributable to Paysign, Inc. $ (9,141,562 ) $ 7,454,319 Denominator: Weighted average common shares: Denominator for basic calculation 49,272,494 47,436,754 Weighted average effects of potentially diluted common stock: Stock options (calculated under treasury method) – 2,079,669 Unvested restricted stock awards – 5,033,946 Denominator for fully diluted calculation 49,272,494 54,550,369 Net income (loss) per common share: Basic $ (0.19 ) $ 0.16 Fully diluted $ (0.19 ) $ 0.14 Due to the net loss for the year ended December 31, 2020, the effect of all potential common share equivalents was anti-dilutive, and therefore, all such shares were excluded from the computation of diluted weighted average shares outstanding for the period. The amount of potential common share equivalents excluded were 2,687,700 stock options and unvested restricted stock awards for the year ended December 31, 2020.

9. COMMITMENTS AND CONTINGENCIE

9. COMMITMENTS AND CONTINGENCIES	12 Months Ended
	Dec. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	9. COMMITMENTS AND CONTINGENCIES Data Center Lease Pending of threatened litigation The Company has been named as a defendant in three complaints filed in the United States District Court for the District of Nevada: Yilan Shi v. Paysign, Inc. et. al., filed on March 19, 2020 (“Shi”), Lorna Chase v. Paysign, Inc. et. al., filed on March 25, 2020 (“Chase”), and Smith & Duvall v. Paysign, Inc. et. al., filed on April 2, 2020 (“Smith” and collectively, the “Complaints” or “Securities Class Action”). Smith was voluntarily dismissed on May 21, 2020. On May 18, 2020, the Shi plaintiffs and another entity called the Paysign Investor Group each filed a motion to consolidate the remaining Shi and Chase actions and to be appointed lead plaintiff. The Complaints are putative class actions filed on behalf of a class of persons who acquired the Company’s common stock from March 12, 2019 through March 31, 2020, inclusive. The Complaints generally allege that the Company, Mark R. Newcomer, and Mark Attinger violated Section 10(b) of the Exchange Act, and that Messrs. Newcomer and Attinger violated Section 20(a) of the Exchange Act, by making materially false or misleading statements, or failing to disclose material facts, regarding the Company’s internal control over financial reporting and its financial statements. The Complaints seek class action certification, compensatory damages, and attorney’s fees and costs. On December 2, 2020, the Court consolidated Shi and Chase as In re Paysign, Inc. Securities Litigation and appointed the Paysign Investor Group as lead plaintiff. On January 12, 2021, Plaintiffs filed an Amended Complaint in the consolidated action. Defendants filed a Motion to Dismiss the Amended Complaint on March 15, 2021. As of the date of this filing, Paysign cannot give any meaningful estimate of likely outcome or damages. The Company has also been named as a nominal defendant in a stockholder derivative action in the U.S. District Court for the District of Nevada: Andrzej Toczek, derivatively on behalf of Paysign, Inc. v. Mark, R. Newcomer, et. al., filed on September 17, 2020. This action alleges violations of Section 14(a) of the Exchange Act, breach of fiduciary duty, unjust enrichment, and waste, largely in connection with the failure to correct information technology controls over financial reporting alleged in the Securities Class Action, thereby causing the Company to face exposure in the Securities Class Action. The derivative complaint also alleges insider trading, violations against certain individual defendants. On December 16, 2020, the Court approved a stipulation staying the action until the Court in the consolidated Securities Class Action issues a ruling on the anticipated Motion to Dismiss. As of the date of this filing, Paysign cannot give any meaningful estimate of likely outcome or damages.

10. RELATED PARTY

10. RELATED PARTY	12 Months Ended
	Dec. 31, 2020
Related Party Transactions [Abstract]
RELATED PARTY	10. RELATED PARTY A member of our Board of Directors is also a partner in a law firm that the Company paid approximately $609,459 and $42,000 during the years ended December 31, 2020 and 2019.

11. INCOME TAXES

11. INCOME TAXES	12 Months Ended
	Dec. 31, 2020
Income Tax Disclosure [Abstract]
INCOME TAXES	11. INCOME TAXES The income tax provision (benefit) on the statements of operations was comprised of the following for the years ended December 31: 2020 2019 Current income taxes $ (23,298 ) $ – Deferred income tax provision (benefit) 917,480 (909,976 ) Income tax provision (benefit) $ 894,182 $ (909,976 ) Deferred tax assets are comprised of the following at December 31: 2020 2019 Deferred tax assets: Net operating loss carryforward $ 4,261,552 $ 837,327 Operating lease obligation 1,016,847 – Stock-based compensation 650,737 497,760 Tax credits 491,261 175,859 Capital loss carryforward and other 270,551 5,825 6,690,948 1,516,771 Deferred tax liabilities: Amortization of intangibles assets (548,149 ) (430,885 ) Depreciation of fixed assets (435,218 ) (168,406 ) Right-of-use assets (1,014,606 ) – (1,997,973 ) (599,291 ) Less valuation allowance (4,692,975 ) – Deferred tax asset, net $ – 917,480 Deferred taxes arise from temporary differences in the recognition of certain expenses for tax and financial reporting purposes. At December 31, 2020, management determined that its more-likely-than-not that the Company’s net deferred tax assets would not be realized in the near future and placed a full valuation allowance on the deferred tax assets. At December 31, 2020 and 2019, net operating loss carryforwards were $18,164,542 and $3,987,271, respectively. $882,542 of the net operating loss carryforwards will expire from 2034 through 2037. At December 31, 2020 state net operating loss carryforwards range from $0 to $4,518,949 which expire from 2039 to 2040. During the year ended December 31, 2020, none of the net operating loss carryforward was utilized. For the years ended December 31, 2020 and 2019, the reconciliation of the federal statutory tax rate to the benefit rate for income taxes is as follows: 2020 2019 Statutory federal tax rate 21.0% 21.0% Permanent differences – stock-based compensation 14.9 (33.9 ) Permanent differences – R&D tax credit 1.3 (0.9 ) Return-to-provision adjustments 2.8 – Change in valuation allowance (56.9 ) – Change in carryovers and tax attributes 6.1 (0.1 ) Effective tax rate (10.8 )% (13.9 )%

12. CHANGE IN ACCOUNTING ESTIMA

12. CHANGE IN ACCOUNTING ESTIMATE	12 Months Ended
	Dec. 31, 2020
Change in Accounting Estimate [Abstract]
CHANGE IN ACCOUNTING ESTIMATE	12. CHANGE IN ACCOUNTING ESTIMATE The Company generates settlement income from breakage on Pharma industry programs which was previously recognized and recorded ratably throughout the account and program lifecycle based on expected dollar loads, spending patterns and historical experience. The Company accumulated data trends on over 100 Pharma programs over the last 10 years and has historically realized settlement income from breakage at an average rate of approximately 23.5%, calculated as unspent balances as a percentage of dollars loaded to card. The most recent completed programs in the prior year performed consistent with our historical breakage estimates. During the third quarter of 2020, the Company changed its estimate of breakage for recognizing settlement income for Pharma programs based on substantially different performance indicators observed, current trends in the industry regarding program management by third parties, and new information available in dollar loads and spending patterns compared to historical experience. Given these triggering events based on the new information observed, this change in accounting estimate resulted in the Company constraining revenue on all Pharma programs in accordance with ASC 606 by changing the estimate of breakage to the remote method of revenue recognition for settlement income whereby the unspent balances will be recognized as revenue at the expiration of the cards and the respective program. This has resulted in the reversal of all previously recognized settlement income for all current Pharma programs. The adjustment was a $6,293,203 reduction in Pharma revenue and an increase in net loss after the impact of income taxes of $4,971,630 or $(0.10) per basic and diluted share for the year ended December 31, 2020.

13. SUBSEQUENT EVENTS

13. SUBSEQUENT EVENTS	12 Months Ended
	Dec. 31, 2020
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	13. SUBSEQUENT EVENTS In 2021, we issued to employees a total of 466,689 shares of common stock for vested stock awards and 32,586 shares for exercised options. On February 24, 2021 the Company announced that Mr. Mark K. Attinger resigned from his position as Chief Financial Officer of the Company, effective February 19, 2021, and that the Board had appointed Jeffery Baker to succeed Mr. Attinger as Chief Financial Officer, effective February 22, 2021. Per the terms of Mr. Attinger’s severance agreement, the Company will continue to pay his salary and benefits through September 30, 2021 and his stock options and stock awards will continue to vest through March 2021 and October 2021, respectively.

2. SUMMARY OF SIGNIFICANT ACC_2

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Dec. 31, 2020
Accounting Policies [Abstract]
Principles of consolidation	Principles of consolidation
Year end	Year end
Use of estimates	Use of estimates
Cash and cash equivalents	Cash and cash equivalents
Restricted cash	Restricted cash
Fixed assets	Fixed assets The Company periodically evaluates whether events and circumstances have occurred that may warrant revision of the estimated useful life of fixed assets or whether the remaining balance of fixed assets should be evaluated for possible impairment. The Company uses an estimate of the related undiscounted cash flows over the remaining life of the fixed assets in measuring their recoverability.
Intangible assets	Intangible assets Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives. Internally Developed Software Costs – For computer software developed or obtained for internal use, costs that are incurred in the preliminary project and post implementation stages of software development are expensed as incurred. Costs incurred during the application and development stage are capitalized. Capitalized costs are amortized using the straight-line method over a three to five year estimated useful life, beginning in the period in which the software is available for use.
Customer card funding	Customer card funding
Fair value of financial instruments	Fair value of financial instruments We determine the fair values of our financial instruments based on the fair value hierarchy established under applicable accounting guidance which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The following describes the three-level hierarchy: Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities. Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. We currently do not have any assets or liabilities in this category. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the overall fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments for which the determination of fair value requires significant management judgment or estimation. The fair value for such assets and liabilities is generally determined using pricing models, market comparables, discounted cash flow methodologies or similar techniques that incorporate the assumptions a market participant would use in pricing the asset or liability. We currently do not have any assets or liabilities in this category.
Earnings per share	Earnings per share
Income taxes	Income taxes We recognize and measure income tax benefits based upon a two-step model: 1) a tax position must be more likely-than-not to be sustained based solely on its technical merits in order to be recognized, and 2) the benefit is measured as the largest dollar amount of that position that is more likely-than-not to be sustained upon settlement. The difference between the benefit recognized for a position and the tax benefit claimed on a tax return is referred to as an unrecognized tax benefit. We accrue income tax related interest and penalties, if applicable, within income tax expense. We have filed consolidated tax returns whereby past subsidiary losses are used to offset tax liabilities on current profits. This approach could be challenged by the Internal Revenue Service (“IRS”) and if not accepted, may affect net income and earnings per share. Management believes that the likelihood of the IRS not accepting such filings is minimal.
Revenue and expense recognition	Revenue and expense recognition Revenue from Contracts with Customers (ASC Topic 606), The Company recognizes revenue when goods or services are transferred to customers in an amount that reflects the consideration which it expects to receive in exchange for those goods or services. In determining when and how revenue is recognized from contracts with customers, the Company performs the following five-step analysis: (i) identification of contract with customers; (ii) determination of performance obligations; (iii) measurement of the transaction price; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligations. The Company generates revenues from Plasma card programs through fees generated from cardholder fees and interchange fees. Revenues from Pharma card programs are generated through card program management fees, interchange fees, and settlement income. Plasma and Pharma card program revenues include both fixed and variable components. Our cardholder fees represent an obligation to the cardholder based on a per transaction basis and recognized at a point in time when the performance obligation is fulfilled. Card program management fees include an obligation to our card program sponsors and are generally recognized when earned on a monthly basis pursuant to the contract terms which are generally multi-year contracts. Interchange fees are earned when customer-issued cards are processed through card payment networks as the nature of our promise to the customer is that we stand ready to process transactions at the customer’s requests on a daily basis over the contract term. Since the timing and quantity of transactions to be processed by us is not determinable, we view interchange fees to comprise an obligation to stand ready to process as many transactions as the customer requests. Accordingly, the promise to stand ready is accounted for as a single series performance obligation. The company uses the right to invoice practical expedient and recognizes revenue concurrent with the processing of card transactions. Previously, settlement income from Pharma programs was recognized and recorded, after giving consideration to any revenue constraints, ratably throughout the program lifecycle based on the Company’s estimate of the unspent balances to be remaining on the card at program expiration. During 2020, the Company observed substantially different performance indicators, current trends in the industry regarding program management by third parties, and new information available in dollar loads and spending patterns compared to historical experience. As a result, the Company changed its estimate of breakage for recognizing settlement income for Pharma programs resulting in the Company constraining revenue on all Pharma programs in accordance with applicable accounting guidance. Based on the recently observed change in facts and circumstances, the Company utilizes the remote method of revenue recognition for settlement income whereby the unspent balances will be recognized as revenue at the expiration of the cards and the respective program. The Company records all revenue on a gross basis since it is the primary obligor and establishes the price in the contract arrangement with its customers. The Company is currently under no obligation for refunding any fees, and the Company does not currently have any obligations for disputed claim settlements. Given the nature of the Company’s services and contracts, it has no contract assets. Cost of revenues is comprised of transaction processing fees, data connectivity and data center expenses, network fees, bank fees, card production costs, customer service, program management, application integration setup, and sales and commission expense.
Operating leases	Operating leases In determining the present value of lease payments at lease commencement date, the Company utilizes its incremental borrowing rate based on the information available, unless the rate implicit in the lease is readily determinable. The liability for operating leases is based on the present value of future lease payments. Operating lease expenses are recorded as rent expense, which is included within selling, general and administrative expenses, within the consolidated statements of operations and presented as operating cash outflows within the consolidated statements of cash flows.
Stock-based compensation	Stock-based compensation
Advertising costs	Advertising costs
New accounting pronouncements	New accounting pronouncements In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in ASU No. 2018-13 provide clarification and modify the disclosure requirements on fair value measurement in Topic 820, Fair Value Measurement. The amendments in this ASU No. 2018-13 are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. We . In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes

3. FIXED ASSETS (Tables)

3. FIXED ASSETS (Tables)	12 Months Ended
	Dec. 31, 2020
Property, Plant and Equipment [Abstract]
Fixed assets	Fixed assets consist of the following: December 31, 2020 December 31, 2019 Equipment $ 1,888,640 $ 2,026,549 Software 200,282 180,223 Furniture and fixtures 752,212 149,684 Website costs 67,816 34,971 Leasehold improvements 203,488 52,894 3,112,438 2,444,321 Less: accumulated depreciation 1,263,274 1,507,136 Fixed assets, net $ 1,849,164 $ 937,185

4. INTANGIBLE ASSETS (Tables)

4. INTANGIBLE ASSETS (Tables)	12 Months Ended
	Dec. 31, 2020
LIABILITIES AND STOCKHOLDERS' DEFICIT
Intangible Assets	Intangible assets consist of the following: December 31, December 31, Patents and trademarks $ 38,186 $ 39,053 Platform 7,478,419 5,598,136 Customer lists and contracts 1,177,200 1,177,200 Kiosk development – 64,802 Licenses 234,282 534,569 8,928,087 7,413,760 Less: accumulated amortization 5,229,054 3,597,528 Intangible assets, net $ 3,699,033 $ 3,816,232
Schedule of intangible assets future amortization expense	Estimated future amortization expense is as follows: 2021 $ 1,637,130 2022 1,170,935 2023 583,438 2024 224,192 2025 8,986 Thereafter 74,352 Total amortization expense $ 3,699,033

5. LEASE (Tables)

5. LEASE (Tables)	12 Months Ended
	Dec. 31, 2020
Leases [Abstract]
Schedule of operating lease liabilities	Twelve months ending December 31, 2021 $ 571,968 2022 571,968 2023 571,968 2024 571,968 2025 612,006 Thereafter 2,829,335 Total lease payments 5,729,213 Less: Imputed interest 1,394,979 Present value of future lease payments 4,334,234 Less: current portion of lease liability (320,636 ) Long-term portion of lease liability $ 4,013,598

6. CUSTOMER CARD FUNDING LIAB_2

6. CUSTOMER CARD FUNDING LIABILITY (Tables)	12 Months Ended
	Dec. 31, 2020
Contract with Customer, Liability [Abstract]
Schedule of contract liabilities	The opening and closing balances of the Company's contract liabilities are as follows: Year Ended December 31, 2020 2019 Beginning balance $ 32,723,227 $ 25,960,974 Increase (decrease), net 15,377,724 6,762,253 Ending balance $ 48,100,951 $ 32,723,227

7. COMMON STOCK (Tables)

7. COMMON STOCK (Tables)	12 Months Ended
	Dec. 31, 2020
Share-based Payment Arrangement [Abstract]
Schedule of option activity	A summary of stock options activity for the years ended December 31, 2020 and 2019 is presented as follows: Weighted- Weighted- Average Average Remaining Aggregate Exercise Contractual Intrinsic Shares Price Term (Years) Value Outstanding at December 31, 2018 2,707,327 $ 2.00 Granted – – Exercised (245,800 ) 1.75 Forfeited/expired (57,727 ) 2.40 Outstanding at December 31, 2019 2,403,800 $ 2.01 8.45 $ 19,565,450 Granted 500,000 3.87 Exercised (71,900 ) 2.40 Forfeited/expired (144,200 ) 2.91 Outstanding at December 31, 2020 2,687,700 $ 2.30 7.74 $ 6,294,948 Exercisable at December 31, 2020 896,100 $ 1.91 7.42 $ 2,445,264
Schedule of unvested option activity	A summary of unvested options activity for the years ended December 31, 2020 and 2019 was as follows: Weighted- Average Grant Date Shares Fair Value Unvested at December 31, 2018 2,707,327 $ 2.00 Granted – – Forfeited/expired (57,727 ) 2.40 Vested (610,200 ) 1.91 Unvested at December 31, 2019 2,039,400 $ 2.01 Granted 500,000 3.87 Forfeited/expired (144,200 ) 2.91 Vested (603,600 ) 1.91 Unvested at December 31, 2020 1,791,600 $ 2.49
Schedule of weighted average grant date fair value and intrinsic value of options exercised	The weighted average grant date fair value of options granted and the total intrinsic value of options exercised for the years ended December 31, 2020 and 2019 is as follows: 2020 2019 Weighted average grant date fair value of options granted $ 2.86 $ – Intrinsic value of options exercised $ 370,764 $ 2,605,923
Schedule of stock awards activity	A summary of stock awards activity for the years ended December 31, 2020 and 2019 was as follows: Weighted- Average Grant Shares Date Fair Value Outstanding at December 31, 2018 5,795,000 $ 0.94 Granted 576,147 9.50 Forfeited (170,000 ) 4.47 Vested (1,801,147 ) 0.68 Outstanding at December 31, 2019 4,400,000 $ 2.06 Granted 254,747 7.80 Forfeited (792,500 ) 4.61 Vested (1,629,558 ) 0.89 Outstanding at December 31, 2020 2,232,689 $ 2.70

8. BASIC AND FULLY DILUTED NE_2

8. BASIC AND FULLY DILUTED NET INCOME PER COMMON SHARE (Tables)	12 Months Ended
	Dec. 31, 2020
Earnings Per Share [Abstract]
Computation of earnings per share	2020 2019 Numerator: Net income (loss) attributable to Paysign, Inc. $ (9,141,562 ) $ 7,454,319 Denominator: Weighted average common shares: Denominator for basic calculation 49,272,494 47,436,754 Weighted average effects of potentially diluted common stock: Stock options (calculated under treasury method) – 2,079,669 Unvested restricted stock awards – 5,033,946 Denominator for fully diluted calculation 49,272,494 54,550,369 Net income (loss) per common share: Basic $ (0.19 ) $ 0.16 Fully diluted $ (0.19 ) $ 0.14

11. INCOME TAXES (Tables)

11. INCOME TAXES (Tables)	12 Months Ended
	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Schedule of components of income tax expense	The income tax provision (benefit) on the statements of operations was comprised of the following for the years ended December 31: 2020 2019 Current income taxes $ (23,298 ) $ – Deferred income tax provision (benefit) 917,480 (909,976 ) Income tax provision (benefit) $ 894,182 $ (909,976 )
Schedule of deferred tax assets	2020 2019 Deferred tax assets: Net operating loss carryforward $ 4,261,552 $ 837,327 Operating lease obligation 1,016,847 – Stock-based compensation 650,737 497,760 Tax credits 491,261 175,859 Capital loss carryforward and other 270,551 5,825 6,690,948 1,516,771 Deferred tax liabilities: Amortization of intangibles assets (548,149 ) (430,885 ) Depreciation of fixed assets (435,218 ) (168,406 ) Right-of-use assets (1,014,606 ) – (1,997,973 ) (599,291 ) Less valuation allowance (4,692,975 ) – Deferred tax asset, net $ – 917,480
Schedule of effective income tax rate reconciliation	2020 2019 Statutory federal tax rate 21.0% 21.0% Permanent differences – stock-based compensation 14.9 (33.9 ) Permanent differences – R&D tax credit 1.3 (0.9 ) Return-to-provision adjustments 2.8 – Change in valuation allowance (56.9 ) – Change in carryovers and tax attributes 6.1 (0.1 ) Effective tax rate (10.8 )% (13.9 )%

2. SUMMARY OF SIGNIFICANT ACC_3

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Cash equivalents	$ 0	$ 0
Estimated useful lives of fixed assets	3 to 10 years
Advertising costs	$ 99,312	$ 165,940

3. FIXED ASSETS (Details - Fixe

3. FIXED ASSETS (Details - Fixed assets) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Fixed Assets Gross	$ 3,112,438	$ 2,444,321
Less: accumulated depreciation	1,263,274	1,507,136
Fixed assets, net	1,849,164	937,185
Equipment [Member]
Fixed Assets Gross	1,888,640	2,026,549
Software [Member]
Fixed Assets Gross	200,282	180,223
Furniture and Fixtures [Member]
Fixed Assets Gross	752,212	149,684
Website Costs [Member]
Fixed Assets Gross	67,816	34,971
Leasehold Improvements [Member]
Fixed Assets Gross	$ 203,488	$ 52,894

3. FIXED ASSETS, NET (Details N

3. FIXED ASSETS, NET (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 428,434	$ 410,019
Loss on abandonment of assets	$ (42,898)	$ 0

4. INTANGIBLE ASSETS (Details -

4. INTANGIBLE ASSETS (Details - Intangible assets) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Intangible assets gross	$ 8,928,087	$ 7,413,760
Less: accumulated amortization	5,229,054	3,597,528
Intangible assets, net	3,699,033	3,816,232
Patents and Trademarks [Member]
Intangible assets gross	38,186	39,053
Platform [Member]
Intangible assets gross	7,478,419	5,598,136
Customer Lists and Contracts [Member]
Intangible assets gross	1,177,200	1,177,200
Kiosk [Member]
Intangible assets gross	0	64,802
Licenses [Member]
Intangible assets gross	$ 234,282	$ 534,569

4. INTANGIBLE ASSETS (Details_2

4. INTANGIBLE ASSETS (Details - Future Amortization)	Dec. 31, 2020USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2021	$ 1,637,130
2022	1,170,935
2023	583,438
2024	224,192
2025	8,986
Thereafter	74,352
Total amortization expense	$ 3,699,033

4. INTANGIBLE ASSETS (Details N

4. INTANGIBLE ASSETS (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Amortization expense	$ 1,696,329	$ 1,073,121
Impairment of intangible assets	382,414	0
Payment for intangible asset	$ 81,261	1,281,064
Customer lists and contracts [Member]
Payment for intangible asset		$ 1,777,200
Minimum [Member]
Intangible assets useful lives	3 years
Maximum [Member]
Intangible assets useful lives	5 years

5. LEASE (Details - Operating l

5. LEASE (Details - Operating lease) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Leases [Abstract]
2021	$ 571,968
2022	571,968
2023	571,968
2024	571,968
2025	612,006
Thereafter	2,829,335
Total lease payments	5,729,213
Less: Imputed interest	1,394,979
Present value of future lease payments	4,334,234
Less: current portion of lease liability	(320,636)	$ 0
Long-term portion of lease liability	$ 4,013,598	$ 0

5. LEASE (Details Narrative)

5. LEASE (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Leases [Abstract]
Lease term	10 years
Lease term option to extend	Two optional extensions of five years each.
Remaining lease term	10 years
Discount rate	6.00%
Operating lease cost	$ 489,104
Short-term lease cost	$ 94,906	$ 223,847

6. CUSTOMER CARD FUNDING LIAB_3

6. CUSTOMER CARD FUNDING LIABILITY (Details - Contract liabilities) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Contract with Customer, Liability [Abstract]
Contract liabilities, beginning balance	$ 32,723,227	$ 25,960,974
Increase (decrease) in contract liabilities	15,377,724	6,762,253
Contract liabilities, ending balance	$ 48,100,951	$ 32,723,227

6. CUSTOMER CARD FUNDING LIAB_4

6. CUSTOMER CARD FUNDING LIABILITY (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Contract with Customer, Liability [Abstract]
Revenue recognized in current year previously included in contract liabilities	$ 844,514	$ 818,889

7. COMMON STOCK (Details - Opti

7. COMMON STOCK (Details - Option activity) - Stock Options [Member] - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Number of Options
Number of Options Outstanding, Beginning	2,403,800	2,707,327
Number of Options Granted	500,000	0
Number of Options Exercised	(71,900)	(245,800)
Number of Options Forfeited/Expired	(144,200)	(57,727)
Number of Options Outstanding, Ending	2,687,700	2,403,800
Number of Options Exercisable, Ending	896,100
Weighted Average Exercise Price
Weighted Average Exercise Price Outstanding, Beginning	$ 2.01	$ 2
Weighted Average Exercise Price Granted	3.87
Weighted Average Exercise Price Exercised	2.40	1.75
Weighted Average Exercise Price Forfeited/Expired	2.91	2.40
Weighted Average Exercise Price Outstanding, Ending	2.30	$ 2.01
Weighted Average Exercise Price Exercisable, Ending	$ 1.91
Weighted Average Remaining Contractual Term
Weighted average contractual term - ending	7 years 8 months 26 days	8 years 5 months 12 days
Weighted average contractual term - exercisable	7 years 5 months 1 day
Aggregate Intrinsic Value
Aggregate intrinsic value - ending	$ 6,294,948	$ 19,565,450
Aggregate intrinsic value - exercisable	$ 2,445,264

7. COMMON STOCK (Details - Nonv

7. COMMON STOCK (Details - Nonvested options activity) - Stock Options [Member] - $ / shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Number of Nonvested Shares
Number of Nonvested Shares Outstanding, Beginning	2,039,400	2,707,327
Number of Nonvested Shares Granted	500,000	0
Number of Nonvested Shares Forfeited/Expired	(144,200)	(57,727)
Number of Nonvested Shares Vested	(603,600)	(610,200)
Number of Nonvested Shares Outstanding, Ending	1,791,600	2,039,400
Weighted Average Exercise Price
Weighted Average Exercise Price Outstanding, Beginning	$ 2.01	$ 2
Weighted Average Exercise Price Granted	3.87
Weighted Average Exercise Price Forfeited/Expired	2.91	2.40
Weighted Average Exercise Price Vested	1.91	1.91
Weighted Average Exercise Price Outstanding, Ending	$ 2.49	$ 2.01

7. COMMON STOCK (Details - Op_2

7. COMMON STOCK (Details - Option information) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Share-based Payment Arrangement [Abstract]
Weighted average grant date fair value of options	$ 2.86
Intrinsic value of options exercised	$ 370,764	$ 2,605,923

7. COMMON STOCK (Details - Stoc

7. COMMON STOCK (Details - Stock Awards Activity) - Common Stock Awards [Member] - $ / shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Stock Outstanding, beginning balance	4,400,000	5,795,000
Stock Granted	254,747	576,147
Stock Forfeited	(792,500)	(170,000)
Stock Vested	(1,629,558)	(1,801,147)
Stock Outstanding, ending balance	2,232,689	4,400,000
Weighted Average Grant Date Fair Value Per Share
Stock Outstanding, beginning balance	$ 2.06	$ 0.94
Stock Granted	7.80	9.50
Stock Forfeited	4.61	4.47
Stock Vested	0.89	0.68
Stock Outstanding, ending balance	$ 2.70	$ 2.06

7. COMMON STOCK (Details Narrat

7. COMMON STOCK (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Common stock, shares authorized	150,000,000	150,000,000
Common stock, par value	$ .001	$ 0.001
Common stock, shares issued	50,251,607	48,577,712
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	25,000,000	25,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Stock based compensation expense	$ 2,971,777	$ 2,528,613
Unrecognized stock-based compensation expense	2,722,518	5,117,179
Proceeds from exercise of options	$ 172,560	$ 430,919
Risk-free interest rate	0.38%
Expected volatility	100.00%
Dividend yield	0.00%
Weighted average expected life	5 years
Asset Acquisition [Member]
Stock issued for asset acquisition, shares	20,000
Stock Options [Member]
Weighted average period to recognize share-based expense	2 years 7 months 6 days
Stock issued for exercise of options, shares	71,900	245,800
Proceeds from exercise of options	$ 172,560	$ 430,919
Stock Awards [Member]
Weighted average period to recognize share-based expense	3 years 5 months 12 days
Stock issued for vested stock awards, shares	1,581,995	1,891,147
2018 Plan [Member]
Common stock reserved for future issuance	5,000,000
Shares available for future grants	3,478,533

8. BASIC AND FULLY DILUTED NE_3

8. BASIC AND FULLY DILUTED NET INCOME (LOSS) PER COMMON SHARE (Details - Earning per share) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Numerator:
Net income (loss) attributable to Paysign, Inc.	$ (9,141,562)	$ 7,454,319
Weighted average common shares:
Denominator for basic calculation	49,272,494	47,436,754
Weighted average effects of potentially diluted common stock:
Stock options (calculated under treasury method)	0	2,079,669
Unvested restricted stock awards	0	5,033,946
Denominator for fully diluted calculation	49,272,494	54,550,369
Basic	$ (0.19)	$ 0.16
Fully diluted	$ (0.19)	$ 0.14

8. BASIC AND FULLY DILUTED NE_4

8. BASIC AND FULLY DILUTED NET INCOME (LOSS) PER COMMON SHARE (Details Narrative)	12 Months Ended
	Dec. 31, 2020shares
Stock Options [Member]
Potential common share equivalents excluded from computation	2,687,700
Unvested Restricted Stock Awards [Member]
Potential common share equivalents excluded from computation	2,232,689

9. COMMITMENTS AND CONTINGENC_2

9. COMMITMENTS AND CONTINGENCIES (Details Narrative) - Co-Location Agreement [Member]	12 Months Ended
	Dec. 31, 2020USD ($)
Lease payment periodic period	$ 8,000
Lease payment frequency	monthly

10. RELATED PARTY (Details Narr

10. RELATED PARTY (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Related Party Transactions [Abstract]
Legal fees paid to related party	$ 609,459	$ 42,000

11. INCOME TAXES (Details - Inc

11. INCOME TAXES (Details - Income Tax Provision) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Current income taxes	$ (23,298)	$ 0
Deferred income tax provision (benefit)	917,480	(909,976)
Income tax benefit (benefit)	$ 894,182	$ (909,976)

11. INCOME TAXES (Details - Def

11. INCOME TAXES (Details - Deferred tax assets) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Deferred tax assets:
Net operating loss carryforward	$ 4,261,552	$ 837,327
Operating lease obligation	1,016,847	0
Stock-based compensation	650,737	497,760
Tax credits	491,261	175,859
Capital loss carryforward and other	270,551	5,825
Deferred tax assets, gross	6,690,948	1,516,771
Deferred tax liabilities:
Amortization of intangibles assets	(548,149)	(430,885)
Depreciation of fixed assets	(435,218)	(168,406)
Right-of-use assets	(1,014,606)	0
Deferred tax liabilities	(1,997,973)	(599,291)
Less valuation allowance	(4,692,975)	0
Deferred tax asset, net	$ 0	$ 917,480

11. INCOME TAXES (Details - Rec

11. INCOME TAXES (Details - Reconciliation)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Statutory federal tax rate	21.00%	21.00%
Permanent differences - stock-based compensation	14.90%	(33.90%)
Permanent differences - R&D tax credit	1.30%	(0.90%)
Return-to-provision adjustments	2.80%	0.00%
Change in valuation allowance	(56.90%)	0.00%
Change in carryovers and tax attributes	6.10%	(0.10%)
Effective tax rate	(10.80%)	(13.90%)

11. INCOME TAXES (Details Narra

11. INCOME TAXES (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Federal [Member]
Net operating loss carryforward	$ 18,164,542	$ 3,987,271
Operating loss carryforward with expiration	$ 882,542
NOL Carryforward [Member] | State [Member]
NOL carryforward range	$0 to $4,518,949
NOL Carryforward [Member] | Minimum [Member] | Federal [Member]
NOL expiration date	Dec. 31, 2034
NOL Carryforward [Member] | Minimum [Member] | State [Member]
NOL expiration date	Dec. 31, 2034
NOL Carryforward [Member] | Maximum [Member] | Federal [Member]
NOL expiration date	Dec. 31, 2037
NOL Carryforward [Member] | Maximum [Member] | State [Member]
NOL expiration date	Dec. 31, 2040

12. CHANGE IN ACCOUNTING ESTI_2

12. CHANGE IN ACCOUNTING ESTIMATE (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Reduction in Pharma revenue	$ 24,120,434	$ 34,666,653
Increase in net loss after taxes	$ (9,141,562)	$ 7,454,319
Impact on basic net loss per share	$ (0.19)	$ 0.16
Impact on diluted net loss per share	$ (0.19)	$ 0.14
Plasma Industry [Member]
Reduction in Pharma revenue	$ 23,401,068	$ 26,994,929
Change In Accounting Method Accounted For As Change In Estimate [Member]
Increase in net loss after taxes	$ (4,971,630)
Impact on basic net loss per share	$ (0.10)
Impact on diluted net loss per share	$ (0.10)
Change In Accounting Method Accounted For As Change In Estimate [Member] | Plasma Industry [Member]
Reduction in Pharma revenue	$ (6,293,203)
Change In Accounting Method Accounted For As Change In Estimate [Member] | Revenue [Member]
Change in accounting estimate description	The Company changed its estimate of breakage for recognizing settlement income for Pharma programs based on substantially different performance indicators observed, current trends in the industry regarding program management by third parties, and new information available in dollar loads and spending patterns compared to historical experience.