GEX Management, Inc. has incurred losses since 2014. Therefore, GEX has no federal tax liability. The net deferred tax asset generated by the loss carryforward has been fully reserved. The cumulative net operating loss carryforward is $377,121 and $78,282 at December 31, 2016 and 2015, respectively, all of which is available for carryforward for federal income tax purposes and will expire in fiscal years 2034 to 2036. At December 31, 2016 and December 31, 2015, the deferred tax asset consisted of the following:
| Dec 31, 2016 | Dec 31, 2015 | |||||||
| Deferred Tax Asset: | ||||||||
| Net Operating (Income) Loss | $ | 128,221 | $ | 26,616 | ||||
| Less Valuation Allowance | (128,221 | ) | (26,616 | ) | ||||
| Net Deferred Tax Asset | $ | — | $ | — | ||||
The change in the valuation allowance of $101,605 is due to the Company’s net loss of $298,839 during the year ended December 31, 2016.
The Company has no tax positions at December 31, 2016 and 2015 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.
The Company’s tax returns for the years ended December 31, 2016, 2015, and 2014 are open for examination under Federal Statute of Limitations.
The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company had no accruals for interest and penalties since inception.