Income Taxes

12 Months Ended

Dec. 31, 2024

Income Taxes

Income Taxes

9. Income Taxes

The following table reconciles the income tax benefit (expense) at the statutory rates to income tax benefit (expense) at the Company’s effective tax rate.

	For the Year Ended December 31, 2024			For the Year Ended December 31, 2023
Net income (loss) before taxes	$	1,779,983		$	793,677
Statutory tax rate		21	%		21	%
Expected income tax due (recovery)		373,796			166,672
Permanent differences and other		-			-
Change in valuation allowance		(373,796	)		(166,672	)
Income tax provision	$	-		$	-

Deferred income taxes reflect the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting processes. Deferred income tax assets and liabilities at December 31, 2024 and 2023 are comprised of the following:

	As of December 31,
Deferred Tax Assets (Liabilities):	2024			2023
Net operating losses carried forward	$	2,016,345		$	2,390,141
Interest expense		-			2,428
Intangible amortization		-			(7,438	)
Total Deferred Tax Assets (Liabilities):		2,016,345			2,385,132
Less valuation allowance		(2,016,345	)		(2,385,132	)
Net deferred tax asset (liability)	$	-		$	-

The 2017 Act reduces the corporate tax rate from 35% to 21% for tax years beginning after December 31, 2017. For net operating losses arising after December 31, 2017, the 2017 Act limits a taxpayer’s ability to utilize net operating losses carryforwards to 80% of taxable income. In addition, net operating losses arising after 2017 can be carried forward indefinitely, but carryback is generally prohibited. Net operating losses 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 net operating losses arising in a tax year ending after 2017 and instead would permit all such net operating losses to be carried forward indefinitely.

At December 31, 2024, the Company had net operating loss carry forwards of approximately $3.9 million. All net operating losses are from 2017 and later and carry an indefinite life. No tax expense or benefit has been reported in the December 31, 2024 or 2023 financial statements and the potential tax benefit is offset by a valuation allowance of the same amount.