Income Taxes

9 Months Ended

Sep. 30, 2013

Income Taxes

Income Taxes

Note H - Income Taxes

The components of income tax (benefit) expense for each of the nine month periods ended September 30, 2013 and 2012 and for the period from August 1, 2007 (date of bankruptcy settlement) through September 30, 2013 are as follows:

					Period from
					August 1, 2007
					(date of
					bankruptcy
	Nine months		Nine months		settlement)
	ended		ended		through
	September 30,		September 30,		September 30,
	2013		2012		2013
Federal:
Current	$	-	$	-	$	-
Deferred		-		-		-
		-		-		-
State:
Current		-		-		-
Deferred		-		-		-
		-		-		-
Total	$	-	$	-	$	-

As of September 30, 2013, pursuant to the August 2010 change in control transaction, the Company has a net operating loss carryforward of approximately $110,000 to offset future taxable income.  The amount and availability of any net operating loss carryforwards will be subject to the limitations set forth in the Internal Revenue Code.  Such factors as the number of shares ultimately issued within a three year look-back period; whether there is a deemed more than 50 percent change in control; the applicable long-term tax exempt bond rate; continuity of historical business; and subsequent income of the Company all enter into the annual computation of allowable annual utilization of any net operating loss carryforward(s).

The Company's income tax expense (benefit) for each of the nine month periods ended September 30, 2013 and 2012 and for the period from August 1, 2007 (date of bankruptcy settlement) through September 30, 2013 varied from the statutory rate of 34% as follows:

							Period from
							August 1, 2007
							(date of
							bankruptcy
	Nine months			Nine months			settlement)
	ended			ended			through
	September 30,			September 30,			September 30,
	2013			2012			2013
Statutory rate applied to
income before income taxes	$	(2,900	)	$	(3,800	)	$	(37,500	)
Increase (decrease) in income
taxes resulting from:
State income taxes		-			-			-
Other, including reserve for
deferred tax asset and application
of net operating loss carryforward		2,900			3,800			37,500
Income tax expense	$	-		$	-		$	-

The Company’s only temporary difference as of September 30, 2013 and 2012, respectively, relates to the Company’s net operating loss pursuant to the applicable Federal Tax Law.  As of September 30, 2013 and December 31, 2012, respectively, the deferred tax asset is as follows:

	September 30,			December 31,
	2013			2012
Deferred tax assets
Net operating loss carryforwards	$	37,500		$	34,600
Less valuation allowance		(37,500	)		(34,600	)
Net Deferred Tax Asset	$	-		$	-

During the nine month period ended September 30, 2013 and the year ended December 31, 2012, respectively, the valuation allowance against the deferred tax asset increased by approximately $2,900 and $4,600.