INCOME TAXES
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12 Months Ended |
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Dec. 31, 2011
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Income Tax Disclosure [Text Block] |
NOTE
5. INCOME
TAXES
Deferred
income taxes arise from the temporary differences between
financial statement and income tax recognition of net
operating losses. These loss carryovers are limited under the
Internal Revenue Code should a significant change in
ownership occur.
At
December 31, 2011 and 2010, after the spinoff of its
subsidiary the Company had net operating loss carry forwards
of $136,600 and $106,000 respectively, which begin to expire
in 2026. The deferred tax asset of $46,400 and $36,000
respectively created by the net operating loss has been
offset by a 100% valuation allowance. The change in the
valuation allowance in 2011 and 2010 was $10,400 and $5,000
respectively.
The
Company’s income tax filings are subject to audit by
various taxing authorities. The Company’s open audit
periods are 2008, 2009, and 2010, although, the statute of
limitations for the 2008 tax year will expire effective March
15, 2011. In evaluating the Company’s provisions and
accruals, future taxable income, and reversal of temporary
differences, interpretations and tax planning strategies are
considered. The Company believes its estimates are
appropriate based on current facts and circumstances.
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