Income Taxes

12 Months Ended

Dec. 31, 2015

Income Tax Disclosure [Abstract]

Income Taxes

Note 9 – Income Taxes

There was no income tax provision for the years ended December 31, 2015 and 2014.

	For the year ended December 31,
	2015			2014
Current	$	—		$	—
Deferred tax benefit		(27,000	)		(23,000	)
Change in valuation allowance		27,000			23,000
Total tax provision	$	—		$	—

The tax provision differs from the expense that would result from applying Federal statutory rates as follows:

	For the year ended December 31,
	2015			2014
Tax / (benefit) at Federal statutory rate	$	(23,000	)	$	(20,000	)
State income tax / (benefit), net of Federal tax effect		(4,000	)		(3,000	)
Change in valuation allowance		27,000			23,000
Tax provision	$	—		$	—

Deferred tax assets and liabilities consist of the following:

	At December 31,
	2015			2014
Deferred tax assets:
Net operating loss carryovers	$	1,031,000		$	1,003,000
Valuation allowance		(1,031,000	)		(1,003,000	)
Net deferred tax assets	$	—		$	—

Realization of deferred tax assets is dependent upon generation of sufficient future taxable income and the effects of other loss utilization provisions. Management has determined that sufficient uncertainty exists regarding the realizability of the net deferred tax assets and has provided a full valuation allowance of $1,031,000 and $1,003,000, against the net deferred tax assets of the Company as of December 31, 2015 and 2014, respectively. A valuation allowance is considered to be a significant estimate that may change in the near term.

At December 31, 2015, the Company had net operating loss carryovers of $2,575,000 available to be carried to future periods. Net operating loss carryovers of $1,778,000 are available for Paragon to use without any limitation or restriction imposed by tax regulations. Changes in the ownership of Paragon’s shares that occurred in 2001, 2003 and 2006 have limited the amount of net operating losses to be used to approximately $72,500 per year for another 11 years, or a total of $797,000. Prior net loss carryovers of approximately $11,100,000 cannot be used due to the limitations imposed by Section 382 of the Code related to the 2001, 2003 and 2006 changes of share ownership.

The loss carryovers expire as follows:

Year Expiring	Net Operating Loss
2026	$	1,551,000
2027		364,000
2028		248,000
2029		81,000
2030		52,000
2031		39,000
2032		61,000
2033		54,000
2034		57,000
2035		68,000
Total loss carryovers	$	2,575,000