The Company determined that the future use of a Deferred Tax Asset was no longer appropriate and therefore the Deferred Tax Asset previously shown on the Balance Sheet has been expensed during this year as a line item on the Statement of Operations. The decision was made that the earnings in the near term would not be sufficient to allow the utilization of the deferred tax asset.

The difference between the expected income tax expense (benefit) and the actual tax expense (benefit) computed by using the Federal statutory rate of 39% is as follows:

				Tax						Tax
	2018			Rate			2017			Rate
Expected income tax benefit at statutory rate of 39%	$	188,000			39	%	$	169,000			39	%
Permanent differences		(124,000	)		(26	%)		(124,000	)		(30	%)
Change in estimate		-0-			-0-			(17,000	)		(4	%)
Change in valuation allowance		(64,000	)		(6	%)		(28,000	)		(6	%)
Income tax expense (benefit)				$	-0-					$	-0-

Deferred tax assets and liabilities are provided for significant income and expense items recognized in different years for tax and financial reporting purposes. Temporary differences, which give rise to a net deferred tax asset, are as follows:

Deferred tax assets:	2018			2017
Tax benefit of net operating loss carry-forward	$	497,000		$	465,000
Book and tax difference		102,000			89,000
Less: valuation allowance		(599,000	)		(554,000	)
Net deferred tax asset	$	-0-		$	-0-

The Company had a federal net operating tax loss carry-forward of approximately $1,260,000 as of June 30, 2018. The loss carry-forwards are available to offset future taxable income with the federal carry-forwards beginning to expire in 2020.

At June 30, 2018 the deferred tax valuation allowance increased by $64,000. The realization of the tax benefits is subject to the sufficiency of taxable income in future years. The deferred tax assets represent the amounts expected to be realized before expiration. The Company periodically assesses the likelihood that it will be able to recover its deferred tax assets. The Company considers all available evidence, both positive and negative, including historical levels of income, expectations and risks associated with estimates of future taxable income and ongoing prudent and feasible profits. As of June 30, 2018 and 2017, the Company established valuation allowances equal to the full amount of the net deferred tax assets due to the uncertainty of the utilization of the operating losses in future periods.

For the years ended June 30, 2018 and 2017, no amounts have been recognized for uncertain tax positions and no amounts have been recognized related to interest or penalties related to uncertain tax positions. The Company has determined that it is not reasonably likely for the amounts of unrecognized tax benefits to significantly increase or decrease within the next twelve months. The Company is currently subject to a three-year statute of limitations by major tax jurisdictions.