Note 6 Income Taxes
A reconciliation of income tax provision to the provision that would be recognized under the statutory rates is as follows:
| December 31, 2017 | December 31, 2016 | |
| $ | $ | |
| Deferred tax asset attributable to: | ||
| Net operating loss | 21,000 | 32,000 |
| Valuation allowance | (21,000) | (32,000) |
| Net | - | - |
The cumulative tax effect at the expected rate of 21% of significant items comprising our net deferred tax amount is as follows:
| December 31, 2017 | December 31 2016 | |
| $ | $ | |
| Refund attributable to operating loss | 150,000 | 128,000 |
| Impact of change in tax rate | (57,500) | |
| Valuation allowance | (92,500) | (128,000) |
| Net provision | - | - |
The cumulative tax effect at the expected rate of 21% of significant items comprising our net deferred tax amount is as follows:
The amount taken into income as deferred tax assets must reflect that portion of the income tax loss carry forwards that is more likely-than-not to be realized from future operations. The Company has chosen to provide an allowance of 100% against all available income tax loss carry forwards, regardless of their time of expiry.
As of December 31, 2017, the Company saw a decrease of approximately $57,500 in deferred tax assets from income tax loss carry forwards. The significant decline in the carry forwards was due the passage of the Tax Cuts and Jobs Act on December 20, 2017 that reduced effective tax rates for future periods to 21% from 34%. The decline in value of the income tax loss carry forwards has no impact on our statement of operations.
No provision for income taxes has been provided in these financial statements due to the net loss. At December 31, 2017, the Company has net operating loss carry forwards, which expire commencing in 2031, totaling approximately $442,000, the benefit of which has not been recorded in the financial statements.