Note 12 - Income Taxes

12 Months Ended

Mar. 31, 2013

Income Tax Disclosure [Text Block]

Income Tax Disclosure [Text Block]

NOTE 12 - INCOME TAXES

At March 31, 2013, the Company had federal and state net operating loss carry-forwards, (NOL’s) of approximately $7,800,000, which are due to expire through fiscal 2032. These NOLs may be used to offset future taxable income through their respective expiration dates and thereby reduce or eliminate our federal and state income taxes otherwise payable. A valuation allowance is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Ultimate utilization of such NOL’s and credits is dependent upon the Company’s ability to generate taxable income in future periods and may be significantly curtailed if a significant change in ownership occurs.

Due to the uncertainty related to future taxable income, the Company provides a 100% valuation allowance for the deferred tax benefit resulting from the NOL’s and depreciation and amortization.

Significant components of deferred tax assets and liabilities are as follows as of March 31, 2013 and 2012:

	2013			2012
Deferred tax assets (liabilities):
Net operating loss carry-forward	$	3,107,000		$	2,892,000
Depreciation and amortization		1,000			1,000
Stock Based Compensation		22,000
Deferred tax assets		3,130,000			2,893,000
Valuation allowance		(3,130,000	)		(2,893,000	)
Deferred tax asset, net	$	-		$	-

The provision for income taxes at March 31, 2013 and 2012 differs from that amount using the statutory federal income tax rate as follows:

	2013			2012
Statutory federal income tax rate		(34	%)		(34	%)
State income taxes, net of federal taxes		(6	)		(6	)
Valuation allowance		40			40
Effective income tax rate		0	%		0	%

In January 2012, the Company completed the sale of their New Jersey State Net Operating Loss (NOL) carry-forward through the New Jersey Corporate Benefit Transfer program.  The Company sold $2,069,864 of tax loss carry-forward for the gross amount of $173,248.  The net amount realized by the Company in the year ended March 31, 2012 was $169,522 after state fees and expenses.