Federal Income Taxes

12 Months Ended

May 31, 2017

Income Tax Disclosure [Abstract]

Federal Income Taxes

Note 7. FEDERAL INCOME TAXES

Deferred taxes as of May 31, 2017 and 2016 are as follows:

	2017			2016
Deferred tax asset:
Net operating loss carryforward	$	2,102,924		$	2,288,919
Stock compensation costs		-			25,346
Accrued expenses		113,021			-
Allowance for doubtful accounts		8,788			4,508
Other		27,540			24,001
Total deferred tax asset		2,252,273			2,342,774
Deferred tax liability:
Depreciation and amortization, tax reporting in excess of financial		(1,970,858	)		(1,059,092	)
Net deferred tax asset	$	281,415		$	1,283,682

In assessing the reliability of deferred tax assets, management considers the likelihood of whether it is more likely than not the net deferred tax asset will be realized. Based on this evaluation, management has determined that Greystone will be able to realize the full effect of the deferred tax asset and no valuation allowance has been recorded as of May 31, 2017 and 2016, respectively.

The net change in deferred taxes for the year ended May 31, 2017 and 2016 is as follows:

	2017			2016
Net operating loss carryforward	$	(229,465	)	$	396,246
Depreciation and amortization, tax reporting in excess of financial		(911,766	)		(906,087	)
Stock compensation costs		18,124			3,714
Allowance for doubtful accounts		4,280			-
Accrued expenses		113,021			-
Other		3,539			10,572
Net decrease	$	(1,002,267	)	$	(495,555	)

The provision for income taxes at May 31, 2017 and 2016 consists of the following:

	2017		2016
Current income tax – Federal and State	$	9,723	$	-
Deferred income tax provision		1,002,267		495,555
Provision for income taxes	$	1,011,990	$	495,555

Greystone’s provision for income taxes for the years ended May 31, 2017 and 2016 differs from the federal statutory rate as follows:

	2017			2016
Tax provision using statutory rates		34	%		34	%
Net operating loss expiration		-			6
Other		(3	)		(1	)
Tax provision per financial statements		31	%		39	%

At May 31, 2017, Greystone had a net operating loss (NOL) for Federal income tax purposes from inception through May 31, 2005 of $15,339,800 expiring in fiscal year 2018 through fiscal year 2025 of which $1,800,000 is management’s estimate of the usable amount pursuant to Internal Revenue Code Section 382. The limitation is due to a change in control of Greystone during the fiscal year ended May 31, 2005. The utilization of NOL’s accumulated through fiscal year 2005 is limited to approximately $225,000 per year.

	NOL Carryforward		Year Expiring
Cumulative through May 31, 2005	$	1,800,000		2018 - 2025
Year ended May 31, 2006		73,284		2026
Year ended May 31, 2007		2,151,837		2027
Year ended May 31, 2011		746,484		2031
Year ended May 31, 2015		321,625		2035
Year Ended May 31, 2016		1,060,747		2036