INCOME TAXES AND AVAILABLE CARRYFORWARD

9 Months Ended

Mar. 31, 2017

Income Tax Disclosure [Abstract]

INCOME TAXES AND AVAILABLE CARRYFORWARD

NOTE D - INCOME TAXES AND AVAILABLE CARRYFORWARD

As of March 31, 2017, the Company had consolidated income tax net operating loss ("NOL") carryforwards for federal income tax purposes of approximately $1,635,000. The NOL will expire in various years ending through the year 2035. The utilization of certain loss carryforwards are limited under Section 382 of the Internal Revenue Code.

         The components of the provision for income tax benefits (expense) attributable to continued operations are as follows:

	Nine Months 3/31/2017		Nine Months 3/31/2016
Current
Federal	$	0	$	0
State		0		0
	$	0	$	0
Deferred
Federal	$	26,015	$	128,184
State		4,685		21,942
	$	30,700	$	150,126
Total Income Tax Benefit (Expense)	$	30,700	$	150,126

Deferred income taxes reflect the net tax effects of the temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows:

	Current		Non-Current
Deferred tax assets
NOL and contribution carryforwards	$	116,474	$	500,886
PTO Accounts		11,091		—
Bonus Accrual		18,776		—
Excess of tax over book depreciation		—		(1,700	)
Allowance for doubtful accounts		4,119		—
Net deferred tax asset	$	150,460	$	499,186

Management believes it is more likely than not that it will realize the benefit of the NOL carryforward, because of its previous trend of earnings. Therefore, a valuation allowance is not considered necessary at this time.

Income taxes for the periods ended March 31, 2017 and 2016 differ from the amounts computed by applying the effective income tax rates of 37.63%, to income taxes as a result of the following:

	Nine Months March 31, 2017		Nine Months March 31, 2016
Expected benefit (provision) at US statutory rate	$	24,224	$	130,878
State income tax net of federal benefit (provision)		2,586		13,973
Nondeductible Expense		3,890		5,275
Income Tax Benefit (Expense)	$	30,700	$	150,126

The earliest tax year still subject to examination by a major taxing jurisdiction is fiscal year end June 30, 2014.

The Company performed a review of its uncertain tax positions in accordance with Accounting Standards Codification ASC 740-10 "Uncertainty in Income Taxes". In this regard, an uncertain tax position represents the Company's expected treatment of a tax position taken in a filed tax return, or planned to be taken in a future tax return, that has not been reflected in measuring income tax expense for financial reporting purposes. As a result of this review, the Company concluded that at this time there are no uncertain tax positions, and there has been no cumulative effect on retained earnings.