Income Taxes

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Income Taxes

5. Income Taxes

Presidential has elected to qualify as a Real Estate Investment Trust under the Internal Revenue Code. A REIT which distributes at least 90% of its real estate investment trust taxable income to its shareholders each year by the end of the following year and which meets certain other conditions will not be taxed on any of its taxable income as long as they distribute the required amounts to its shareholders.

ASC 740 prescribes a more likely than not recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken. If the Company’s tax position in relation to a transaction was not likely to be upheld, the Company would be required to record the accrual for the tax and interest thereon. As of December 31, 2020, the tax years that remain open to examination by the federal, state, and local taxing authorities are the 2017 – 2020 tax years and the Company was not required to accrue any liability for those tax years.

The Company has accumulated a net operating loss carry forward of approximately $21,038,000. These net operating losses may be available in future years to reduce taxable income when and if it is generated. These loss carryforwards begin to expire in 2027 and are available to offset 100% of taxable income. Net operating losses generated in 2018 and thereafter will be available to offset 80% of taxable income beginning in 2021. Under the Cares Act, taxpayers with NOLs arising in tax years beginning in 2018, 2019 and 2020 can carry them back five years.

For the year ended December 31, 2020, the Company had a taxable income of approximately $46,000 ($.00 per share), before utilization of net operating loss carry forwards, which was all ordinary income.

For the year ended December 31, 2019, the Company had taxable income of approximately $123,000 ($.02 per share), before utilization of net operating loss carry forwards, which was all ordinary income.

For the year ended December 31, 2018, the Company had a taxable income of approximately $89,000 ($.02 per share), before utilization of net operating loss carry forwards, which was all ordinary income.

For the year ended December 31, 2017, the Company had taxable losses of approximately $481,000 ($.09 per share), which was all ordinary loss.