Note 9 - Income Taxes
Deferred income taxes are determined using the liability method for the temporary differences between the financial reporting basis and income tax basis of the Company’s assets and liabilities. Deferred income taxes are measured based on the tax rates expected to be in effect when the temporary differences are included in the Company’s tax return. Deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases.
Operating loss carry-forwards generated through December 31, 2016 of approximately $774,450, will begin to expire in 2034. The Company applies a statutory income tax rate of 34%. Accordingly, deferred tax assets related to net operating loss carry-forwards total approximately $263,285 at December 31, 2016. For the year ended December 31 2016, the valuation allowance increased by approximately $88,000.
The Company had deferred income tax assets as of December 31, 2016 and 2015 as follows: