NOTE 9. INCOME TAXES
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Dec. 31, 2012
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Income Tax Disclosure [Text Block] |
NOTE 9.
INCOME TAXES
The
provision for income taxes consists of the
following:
The
provision for income taxes differs from the amount computed
by applying the federal statutory income tax rate (35%) on
operations due primarily to permanent differences
attributable to organizational expenses for the purchase of
Art Design, Inc. (the shell company) in the amount of
$148,014.
The
components of the net deferred tax asset were as
follows:
A
valuation allowance has been established to offset deferred
tax assets. The Company's accumulated net operating losses
were approximately $2.3 million at December 31, 2012 and
begin to expire if not utilized in the year
2032.
The
Company has determined that as a result of the acquisition of
substantially all of the outstanding stock of Art Design,
Inc. (see Note 4), a change of control pursuant to Section
382 of the Internal Revenue Code of 1986 occurred. As a
result, the Company’s ability to use any net operating
losses attributable to Art Design, Inc. for federal income
tax purposes has been forfeited.
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