NOTE K – INCOME TAXES
Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has net operating losses of $7,343,777 since inception on January 19, 2006. The Company computes tax asset benefits for net operating losses carried forward. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years. The net operating loss can be carried forward indefinitely. Due to discontinuing operation in June 2008 and the change in ownership, restrictions may apply.
The components of the net deferred tax asset at December 31, 2017 and December 31, 2016 and the statutory tax rate, the effective tax rate and the elected amount of the valuation allowance are indicated below:
|
| December 31, 2017 |
| December 31, 2016 |
|
|
|
|
|
| Net Operating Losses | $ 7,353,712 |
| $ 6,976,480 |
| Statutory Tax Rate | 21% |
| 35% |
| Effective Tax Rate | - |
| - |
| Deferred Tax Asset | 1,544,279 |
| 2,441,768 |
| Valuation Allowance | (1,544,279) |
| (2,441,768) |
| Net Deferred Tax Asset | $ - |
| $ - |
The tax years ended December 31, 2015, 2016 and 2017 are open for audit by both federal and state taxing authorities.
Income tax benefit resulting from applying statutory rates in jurisdictions in which we are taxed (Federal and State of Florida) differs from the income tax provision (benefit) in our financial statements. The following table reflects the reconciliation for the years ended December 31, 2017 and 2016:
| Year Ended December 31, | |||
| 2017 |
| 2016 | |
| Benefit at federal and statutory rate | (35)% | (35)% | |
| Change in valuation allowance | 35% | 35% | |
| Effective tax rate | 0% | 0% | |