Note 2 - Income Tax Disclosure

12 Months Ended

Sep. 30, 2020

Notes

Note 2 - Income Tax Disclosure

Note 2 - Income Taxes. At September 30, 2020, the Company had a depletion carryforward of $860,000 and a net operating loss carryforward of $2,473,000, of which $2,259,000 will expire in the years 2027 through 2037. The approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax assets at September 30, 2020, computed in accordance with the Income Tax Topic (Topic 740) of the Codification, is as follows:

Deferred Tax Assets		2020	2019
Depletion carryforward	$	181,000	181,000
Net operating loss carryforward		519,000	491,000
Accrued shareholder salary		215,000	215,000
Deletion and amortization		4,000	6,000
Total Net Deferred Tax Assets		919,000	893,000
Less valuation allowance		(919,000)	(893,000)
Net Deferred Tax Asset	$	-	-

A valuation allowance has been provided because of the uncertainty of future realization. Income tax expense is different from amounts computed by applying the statutory Federal income tax rate for the following reasons:

		2020	2019
Tax benefit at 21% of net earnings	$	(27,000)	(7,000)
Impact of rate change effective January 1, 2018		-	-
Change in valuation allowance for net deferred tax assets		(27,000)	(7,000)
Income tax expense	$	-	-

As of September 30, 2020, the Company has no unrecognized tax benefit as a result of uncertain tax positions. As of September 30, 2020, the Company’s tax years that remain subject to examination are 2017 - 2020 (Federal jurisdiction) and 2016 - 2020 (state jurisdictions).