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Income Tax

9 Months Ended

Sep. 30, 2018

Income Tax Disclosure [Abstract]

INCOME TAX

9. INCOME TAX

The Company files income tax returns in the U.S. federal jurisdiction, and various state and local jurisdictions. The Company is no longer subject to U.S. federal, state and local income tax examinations by tax authorities for years before 2013.

On December 22, 2017 H.R. 1, originally known as the Tax Cuts and Jobs Act, (the “Tax Act”) was enacted. Among the significant changes to the U.S. Internal Revenue Code, the Tax Act lowers the U.S. federal corporate income tax rate (“Federal Tax Rate”) from 35% to 21% effective January 1, 2018. The 21% Federal Tax Rate will apply to earnings reported for the full 2018 fiscal year. In addition, the Company must re-measure its net deferred tax assets and liabilities using the Federal Tax Rate that will apply when these amounts are expected to reverse. As of September 30, 2018 and December 31, 2017, the Company can determine a reasonable estimate for certain effects of tax reform and recorded that estimate as a provisional amount. The provisional remeasurement of the deferred tax assets and allowance valuation of deferred tax assets at September 30, 2018 and December 31, 2017 resulted in a net effect of $0 discrete tax expenses (benefit) which lowered the effective tax rate by 14% for the nine months ended September 30, 2018 and for the year ended December 31, 2017. The provisional remeasurement amount is anticipated to change as data becomes available allowing more accurate scheduling of the deferred tax assets and liabilities primarily related to net operating loss carryover.

Components of income tax (benefits) for the nine months ended September 30, 2018 and 2017 are as follows:

		For the Nine Months Ended September 30,
		2018												2017
		Federal				State				Total				Federal				State				Total
Current		$	-			$	1,850			$	1,850			$	-			$	830			$	830
Deferred			-				-				-				-				-				-
		$	-			$	1,850			$	1,850			$	-			$	830			$	830

Significant components of the Company’s deferred tax accounts at September 30, 2018 and December 31, 2017:

		September 30, 2018				December 31, 2017
Deferred Tax Account - noncurrent:
Tax losses carryforwards		$	756,189			$	594,501
Less: Valuation allowance			(756,189	)			(594,501	)
Total deferred tax account - noncurrent		$	-			$	-

The difference between the effective rate reflected in the provision for income taxes on loss before taxes and the amounts determined by applying the applicable statutory U.S. tax rate are analyzed below:

		For the Nine Months Ended September 30,
		2018				2017
Statutory federal tax benefit, net of state tax effects			19	%			31	%
State income taxes			8.84	%			8.84	%
Nondeductible/nontaxable items			(2	)%			(4	)%
Change in valuation allowance			(25.84	)%			(35.84	)%
Effective income tax rate			0.00	%			0.00	%

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- References

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- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI http://asc.fasb.org/topic&trid=2144680

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