Note 8 - Income Taxes

12 Months Ended

Jun. 30, 2017

Notes to Financial Statements

Income Tax Disclosure [Text Block]

8

.     INCOME TAXES:

The reconciliation between the expected federal income tax benefit computed by applying the Federal statutory rate to loss before income taxes and the actual benefit for taxes on loss for the years ended

June 30, 2017

and

2016

is as follows:

	2017			2016
Expected income tax benefit at statutory rate	$	(836,000	)	$	(1,537,000	)
State taxes, net of federal benefit		(75,000	)		(138,000	)
Permanent differences and other		3,000			(13,000	)
Change in valuation allowance		908,000			1,688,000
Income tax benefit	$	-		$	-

The Company has net operating loss carry-forwards (“NOLs”) for tax purposes of approximately

$52,861,000

as of

June 30, 2017.

These NOLs expire on various dates through

2037.

The utilization of the NOLs

may

be limited under Section

382

of the Internal Revenue Code.

The Company

’s deferred tax assets for the years ended

June 30, 2017

and

2016

are estimated as follows:

	2017			2016
NOLs – noncurrent	$	20,087,000		$	19,705,000
Stock-based compensation - current		5,589,000			5,392,000
Property and equipment – noncurrent		2,014,000			2,014,000
Deferred compensation - noncurrent		2,017,000			1,688,000
Gross deferred tax assets		29,707,000			28,799,000
Valuation allowance		(29,707,000	)		(28,799,000	)
Net deferred tax assets	$	-		$	-

The Company has provided a valuation allowance of

100%

of its net deferred tax asset due to the uncertainty of generating future profits that would allow for the realization of such deferred tax assets.