Quarterly report pursuant to sections 13 or 15(d)

Income Taxes

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Income Taxes
 6 Months Ended
Jun. 30, 2011
Income Taxes  
Income Taxes

Note 14: Income Taxes

 

For the six months ended June 30, 2011 and year ended December 31, 2010, we incurred a net loss and, therefore, have no tax liability.  We have a previous net operating loss carry-forward of $1,160,000.  The losses will be carried forward and can be used through the year 2028 to offset future taxable income up to a cumulative total of approximately $1,226,000.  The cumulative net operating loss carry-forward for income tax purposes may differ from the cumulative financial statement loss due to permanent differences and timing differences between book and tax reporting.  Additionally, we have a foreign tax credit carry-forward of approximately $203,627 that can be used in the future to offset federal income tax owed.

 

We periodically review the need for a valuation allowance against deferred tax assets based upon earnings history and trends.  We believe that the valuation allowances provided are appropriate.

 

The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows:

 

 

 

2011

 

2010

 

Deferred tax asset attributable to:

 

 

 

 

 

Net operating loss carryover

 

$

461,100

 

$

378,700

 

Valuation allowance

 

(461,100

)

(378,700

)

Net Deferred Tax Asset

 

$

—

 

$

—