Note 3: Income Taxes

12 Months Ended

Dec. 31, 2022

Notes

Note 3: Income Taxes

Note 3: Income Taxes

As of December 31, 2022, the Company had net operating loss carry forwards of approximately $12.5 million that may be available to reduce future years' taxable income. Future tax benefits, which may arise because of these losses, have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carryforwards.

The 2017 Act reduces the corporate tax rate from 35% to 21% for tax years beginning after December 31, 2017. For net operating losses (NOLs) arising after December 31, 2017, the 2017 Act limits a taxpayer’s ability to utilize NOL carryforwards to 80% of taxable income. In addition, NOLs arising after 2017 can be carried forward indefinitely, but carryback is generally prohibited. NOLs generated in tax years beginning before January 1, 2018, will not be subject to the taxable income limitation. The 2017 Act would generally eliminate the carryback of all NOLs arising in a tax year ending after 2017 and instead would permit all such NOLs to be carried forward indefinitely.

The 2020 CARES Act provides for a carryback of any NOLs arising in a taxable year beginning after December 31, 2017, and before January 1, 2021, to each of the five taxable years preceding the taxable year in which the loss arises (carryback period). As a result of that amendment, taxpayers take into account such NOLs in the earliest taxable year in the carryback period, carrying forward unused amounts to each succeeding taxable year. The CARES Act does not have a material impact to the Company’s financial position or result of operations.

The provision for federal income tax consists of the following for the twelve months ended:

	December 31, 2022	December 31, 2021
Federal income tax benefit attributable to:
Current operations	$154,070		$153,781
Less: valuation allowance	(154,070)		(153,781)
	-		-

The cumulative tax effect at the expected rate of 21% of significant items comprising our net deferred tax amount is as follows:

	December 31, 2022	December 31, 2021
Deferred tax asset attributable to:
Net operating loss carryover	$2,631,509	$2,599,153
Less: valuation allowance	(2,631,509)	(2,599,153)
Net deferred tax asset	$-	$-

Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of $12.5 million for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, the net operating loss carry forwards may be limited to use in future years.

As of December 31, 2022, in accordance with the Internal Revenue Service (“IRS”) Assessment Statute of Limitations, the IRS has the ability to audit or assess the Company’s tax returns on the basis of the following schedule:

Year	End of IRS Assessment Statute of Limitations
2019	Oct 15, 2023
2020	Oct 15, 2024
2021	Oct 15, 2025
2022	Oct 15, 2026