Note 3 - Income Taxes

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Income Tax Disclosure [Text Block]

Note 3. Income Taxes     

The Company files federal and state income tax returns on a calendar year basis.

The net deferred tax liability in the accompanying balance sheets includes the following components at

December

31,

2016

and

2015:

	2016			2015
Deferred tax assets	$	--		$	--
Deferred tax liabilities		(298,919	)		(292,767	)
	$	(298,919	)	$	(292,767	)

Reconciliations between the United States Federal statutory income tax provision, using the statutory rate of

34%,

and the Company’s provision for income taxes at

December

31,

2016

and

2015

are as follows:

	2016			2015
Income tax on income before extraordinary item:
Tax at statutory rates	$	75,586		$	229,094
Tax effect of the following:
Statutory depletion		(24,936	)		(39,383	)
Section 1033 deferred gain		--			(58,090	)
Section 179 deduction		(5,229	)		--
State income tax		808			10,481
Other		(744	)		335
Income tax on income	$	45,485		$	142,437

Deferred income taxes result from timing differences in the recognition of revenue and expenses for tax and financial statement purposes. The effect of these timing differences at

December

31,

2016

and

2015

is as follows:

	2016			2015
Casualty loss	$	(121,239	)	$	(121,239	)
Deferred gain		(171,528	)		(171,528	)
Section 179 deduction		(6,152	)		--
	$	(298,919	)	$	(292,767	)