8. Income Taxes

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 8.                      INCOME TAXES

The Company provides for income taxes using an asset and liability approach. Deferred tax assets and liabilities are recorded based on the temporary differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect currently.

The Company recognizes reductions in its deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In the Company’s opinion, it is uncertain whether it will generate sufficient taxable income in the future to fully utilize the net deferred tax asset. Accordingly, a valuation allowance equal to the deferred tax asset has been recorded.

The Company’s deferred tax assets by period are as follows:

	December 31,			December 31,
	2018			2017
Deferred Tax Asset	$	264,000		$	257,000
Valuation Allowance		(264,000	)		(257,000	)
Income Tax Expense	$	–		$	–

The components of income tax expense for the years ended December 31, 2018 and 2017, respectively, are as follows:

	December 31,			December 31,
	2018			2017
Change in Net Operating Loss	$	7,000		$	216,000
Change in Valuation Allowance		(7,000	)		(216,000	)
Income Tax Expense	$	–		$	–

The differences between the statutory income tax rates computed at the U.S. federal statutory rate and our effective rate were the following:

	December 31,			December 31,
	2018			2017
Federal Statutory Rate		21%			21%
Current Loss and NOL Carry Forward		(21%	)		(21%	)
Net Rate		0%			0%

On December 22, 2017, the President signed into law Public Law No. 115-97, commonly referred to as the Tax Cuts and Jobs Act (TCJA), following its passage by the United States Congress. The TCJA makes significant changes to the U.S. federal income tax laws including among other changes a federal corporate tax rate reduction from 35% to 21% for tax years beginning after December 31, 2017, repeal of the corporate AMT tax system, and immediate expensing of certain types of business assets placed in service after September 27, 2017. Due to the impact of the Company’s full valuation allowance on net deferred tax assets, the TCJA had minimal impact on the Company’s provision for income taxes. As a result of the reduction in the federal corporate tax rate, the Company recorded additional tax expense of $168,000 with a corresponding reduction in the valuation allowance.

As of December 31, 2018, the Company had net operating loss carryforwards totaling approximately $1,257,000. The Company does not believe that it has any uncertain tax positions, correspondingly, no estimated accruals for interest and penalties have been made in the accompanying financial statements.

The Company’s tax returns currently subject to audit by the Internal Revenue Service are for the periods ended December 31, 2014 through the present.