Quarterly report pursuant to Section 13 or 15(d)

NOTE 7 - INCOME TAXES

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NOTE 7 - INCOME TAXES
 3 Months Ended
Mar. 31, 2013
Income Tax Disclosure [Abstract]  
NOTE 7 - INCOME TAXES

NOTE 7 - INCOME TAXES

 

At March 31, 2013, the Company had federal and state net operating loss carry forwards of approximately $1,358,000 that expire in 2024.

 

Due to operating losses, there is no provision for current federal or state income taxes for the periods ended March 31, 2013 or 2012.

 

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amount used for federal and state income tax purposes.

 

The Company’s deferred tax asset at March 31, 2013 consists of a net operating loss calculated using federal and state effective tax rates equating to approximately $530,000 less a valuation allowance in the amount of approximately $530,000. Because of the Company’s lack of earnings history, the deferred tax asset has been fully offset by a valuation allowance. The measurement valuation allowance increased by $67,000 and $39,000 during the 2013 and 2012 periods respectively.

 

The Company’s total deferred tax asset as of March 31, 2013 is as follows:

 

 Deferred tax asset – gross   $ 530,000  
 Valuation allowance     (530,000 )
 Net deferred tax asset   $ —    

 

The reconciliation of income taxes computed at the federal and state statutory income tax rate to total income taxes for the periods ended March 31, 2013 and 2012 is as follows:

 

    2013   2012
Income tax computed at the federal statutory rate     34 %     34 %
 Income tax computed at the state statutory rate     5 %     5 %
 Valuation allowance     (39 %)     (39 %)
 Total deferred tax asset     0 %     0 %