6. INCOME TAX
The provision (benefit) for income taxes consisted of the following for the years ended June 30:
| 2017 | 2016 | |||||
| Current | $ | - | $ | - | ||
| Deferred | (307,726) | (246,279) | ||||
| Valuation allowance | 307,726 | 246,279 | ||||
| Income tax provision (benefit) | $ | - | $ | - | ||
The following table reconciles the effective income tax rates with the statutory rates for the years ended June 30:
| 2017 | 2016 | ||||
| U.S. federal statutory rate | 34.0 | % | 34.0 | % | |
| State and local taxes- net of federal benefit | 9.8 | 8.0 | |||
| Valuation allowance | (43.8) | (42.0) | |||
| Effective income tax rate | - | % | - | % |
Deferred tax assets are comprised of the following:
|
June 30, 2017 |
June 30, 2016 | |||||
| Deferred tax assets | $ | 307,726 | $ | 246,279 | ||
| Less: valuation allowance | (307,726) | (246,279) | ||||
| Net deferred tax assets | $ | - | $ | - | ||
At June 30, 2017, the Company had approximately $703,000 of Federal net operating carryforward losses that may be available to offset future taxable income. The net operating loss carryforwards, if not utilized, will expire through 2037. The amount and availability of prior net operating loss carry-forwards may be subject to limitations set forth by the Internal Revenue Code.
The Company assesses the likelihood that deferred tax assets will be realized. To the extent that realization is not likely, a valuation allowance is established. Management believes that it is more likely than not that future benefits of the deferred tax asset will not be realized principally due to its continuing operating losses and has therefore established a full valuation allowance.