Income Taxes Disclosure

12 Months Ended

Dec. 31, 2020

Notes

Income Taxes Disclosure

8. Income Taxes

There was no provision for income tax for the years ended December 31, 2020 and 2019. The Company files a consolidated federal income tax return.

The difference between the basis of assets and liabilities for financial and income tax reporting are not considered material. There were approximately $2,355,000 in net operating loss carryforwards at December 31, 2020, and approximately $2,229,000 at December 31, 2019, representing a potential deferred tax asset. The deferred tax asset amounted to approximately $495,000 at December 31, 2020 at current corporate tax rates, as compared to $468,000 at December 31, 2019. Of the total $2,355,000 total net operating losses at December 31, 2020, approximately $1,560,000 expire in various years through 2037 and approximately $795,000 carry forward indefinitely. For net operating losses prior to the Merger, net operating loss carryforwards are subject to limitations as a result of a change in ownership as defined by IRC Section 382. Upon an assessment of the potential of realizing these deferred tax assets in the future, an offsetting valuation allowance has been established for the full amount of the deferred tax assets.