Income Taxes

12 Months Ended

Jun. 30, 2017

Notes to Financial Statements

7. INCOME TAXES

As of June 30, 2017, the Company had federal and state net operating loss carryforwards of approximately $7,258,933 of which approximately $1,160,000 may be utilized to offset future taxable income. Section 382 of the Internal Revenue Code imposes substantial restrictions on the utilization of net operating loss and tax credit carryforwards when a change in ownership occurs. No deferred tax debits have been recorded because it is considered unlikely that they will be realized. The loss carryforwards will expire during the fiscal years ended June 30 as follows:

Year	Amount
2018		236,000
2019		548,000
2020		351,000
2021		29,000
Total	$	1,164,000

The overall effective tax rate differs from the federal statutory tax rate of 35% due to operating losses and other deferred assets not providing benefit for income tax purposes.

A reconciliation of income tax expense at the federal statutory rate to income tax expense at the Company’s effective rate is as follows at June 30, 2016 and 2017:

	2017			2016
United States Statutory Income tax Rate		35	%		35	%
Decrease in rate on income subject to Danish income tax rates		13	%		12	%
Decrease in rate resulting from Non-Deductible expenses		-			-
Income Tax Expense		22	%		23	%

The components of income tax expense (benefit) from continuing operations for the years ended June 30, 2017 and 2016 consisted of the following:

Current Tax Expense	2017			2016
Danish Income Tax Expense (Benefit)	$	(8,567	)	$	4,591
Federal US Income Tax Expense (Benefit)
Current					-
Deferred		-			-
Total Income Tax Expense	$	(8,567	)	$	4,591

Deferred income tax expense/(benefit) results primarily from the reversal of temporary timing differences between tax and financial statement income.