INCOME TAXES

12 Months Ended

Dec. 31, 2012

Notes to Financial Statements

Note 2. INCOME TAXES

At December 31, 2012, the Company had U.S. net operating loss carryforwards of approximately $15 million that will expire commencing in 2023 through 2031. These carryforwards may be subject to certain limitations on annual utilization in the event of a change in ownership, as defined by tax law. The Company has established valuation allowances to fully offset the deferred income tax assets related to these loss carryforwards, based upon  the available evidence that indicates that it is more likely than not that the Company will not realize the tax benefits. The Company’s income tax returns remain subject to examination for the years 2009 through 2012 for federal and state purposes.