INCOME TAXES |
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INCOME TAXES | NOTE 8. INCOME TAXES The Company’s net deferred tax assets (liability) at December 31, 2022 and December 31, 2021 are as follows:
The income tax provision for the years ended December 31, 2022 and December 31, 2021 consists of the following:
As of December 31, 2022 and December 31, 2021, the Company has $0 and $185,061, respectively, of U.S. federal net operating loss carryovers, which do not expire, and no state net operating loss carryovers available to offset future taxable income. The Company has not filed its tax returns. In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the years ended December 31, 2022 and December 31, 2021, the change in the valuation allowance was $287,359 and $335,341, respectively. A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2022 and December 31, 2021 are as follows:
The Company files income tax returns in the U.S. federal jurisdiction in various state and local jurisdictions, including California, and is subject to examination by the various taxing authorities. |