Note 3: Income Taxes

12 Months Ended

Dec. 31, 2017

Notes

Note 3: Income Taxes

Note 3: Income Taxes

As of December 31, 2017, the Company had net operating loss carry forwards of approximately $11.7 million that may be available to reduce future years' taxable income through 12/31/2033. 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 carry-forwards.

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

	December 31, 2017			December 31, 2016
Federal income tax benefit attributable to:
Current Operations	$	38,904			$	62,626
Less: valuation allowance		(38,904	)			(62,626	)
Net provision for Federal income taxes	$	-			$	-

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

	December 31, 2017			December 31, 2016
Deferred tax asset attributable to:
Net operating loss carryover	$	2,458,520		$	3,917,473
Less: valuation allowance		(2,458,520	)		(3,917,473	)
Net deferred tax asset	$	-		$	-

Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of $11.7 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.