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Income Taxes

6 Months Ended

Dec. 31, 2014

5. Income Taxes

For the six months ended December 31, 2014, the Company recorded an income tax expense from continuing operations of $47,817.

For the six months ended December 31, 2014 and 2013, the effective rate of 4% and (1%), respectively, on continuing operations varied from the U.S. federal statutory rate primarily due to permanent book tax differences, state taxes and a change in the valuation allowance.

The Company established a valuation against the deferred tax asset in prior years when management concluded that it is more likely than not that the deferred tax asset may not be fully realized. Management’s deferred tax asset assessment on realizability is unchanged as of December 31, 2014, but the Company is currently utilizing the valuation allowance against tax expense when the Company records net income.

As of December 31, 2014 and June 30, 2014, the Company has no material unrecognized tax benefits or accrued interest and penalties.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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