note 6 - Income Tax Provision

12 Months Ended

Dec. 31, 2010

note 6 - Income Tax Provision:

note 6 - Income Tax Provision

NOTE 6 - INCOME TAX PROVISION

The Company’s provision for income taxes was $-0- and $-0- for the years ended June 30, 2012 and 2011 respectively, since the Company incurred net operating losses through June 30, 2012.

Income tax expense for the years ended June 30, 2012 and 2011 differed from the amounts computed by applying the U.S. federal income tax rate of 34 percent as follows:

	June 30,
	2012		2011
Income tax benefit at U.S. federal statutory rates	$	(1,205,256)	$	(361,972)
Effect of:
Common stock issued for services		1,029,205		239,641
Increase (decrease) in valuation allowance		176,051		122,331
Other, net		-		-
Provision for income taxes	$	-	$	-

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets at June 30, 2012 and 2011 are presented below:

	June 30,
	2012		2011
Deferred tax assets
Net operating losses	$	6,885,870	$	6,709,791
Less: valuation allowance		(6,885,870)		(6,709,791)
Net deferred tax assets		-		-
Deferred tax liabilities		-		-
Net deferred taxes	$	-	$	-

As of June 30, 2012, the Company had net operating loss carryforwards of approximately $8.9 million, $4.7 million and $13.1 million available to offset future taxable federal, state and foreign income, respectively. The federal and state carryforward amounts expire in varying amounts between 2012 and 2032. The foreign net operating loss carryforwards do not have an expiration period.  The valuation allowance increased by $170,416 to $6,880,236 during the year ended June 30, 2012.

The Company has evaluated its uncertain tax positions and determined that any required adjustments for unrecognized tax benefits would not have a material impact on the Company’s balance sheet, income statement, or statement of cash flows.

The Company’s tax filings for 2008 through 2012 remain subject to examination by tax authorities for federal income tax purposes and by other major taxing jurisdictions to which we are subject. The Company has identified potential penalties for the late filing of reports to taxing authorities. The Company believes that it is more likely than not the penalties will be waived and accordingly has not accrued the penalties in the financial statements.