Quarterly report pursuant to Section 13 or 15(d)

9. INCOME TAXES

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9. INCOME TAXES
 3 Months Ended
Mar. 31, 2013
Related Party Transaction  
Income Taxes

At December 31, 2012, the Company has a net operating loss (NOL) carry forward of approximately $144,000 which is available to offset future taxable income and which expires through 2032. This loss carry forward will likely be further limited pursuant to Internal Revenue Code Section 382 due to the change in control (Note 1). Through December 31, 2012, there have been no temporary differences between reported net losses and taxable losses.

 

The differences between the expected income tax benefit and the actual recorded income tax benefit computed using a statutory federal rate of 35% is as follows.

 

    Years Ended December 31,     Years Ended December 31,  
    2012     2012  
Income tax benefit at statutory 35% rate   $ (15,964 )   $ (31,563 )
Change in valuation allowance     15,964       31,563  
                 
Income tax benefit   $ –     $ –  

 

 

Deferred tax assets and liabilities are provided for significant income and expense items recognized in different years for tax and financial reporting purposes. The Company periodically assesses the likelihood that it will be able to recover its deferred tax assets. The Company considers all available evidence, both positive and negative, including historical levels of income, expectations and risks associated with estimates of future taxable income and ongoing prudent and feasible profits. At March 31, 2013 and 2012, the Company established valuation allowances equal to the full amount of its deferred tax assets due to the uncertainty of the utilization of the net operating losses in future periods. 

 

Tax benefit from NOL carry forward   $ 50,476     $ 34,512  
Less valuation allowance     (50,476 )     (34,512 )
                 
Net deferred tax asset   $ –     $ –  

 

The Company has not filed tax returns since its inception but, because of its operating losses, management believes the Company is not exposed to any significant risk of penalty or forfeiture of operating loss carry forwards.