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Income Taxes
 12 Months Ended
Dec. 31, 2015
Income Taxes:  
Income Taxes

Note 10 – Income Taxes

 

Deferred income taxes are provided based on the provisions of ASC Topic 740, “Accounting for Income Taxes”, to reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

 

Significant components of the Company’s net deferred income taxes are as follows:

 

    For the Years ended
December 31,
    2015   2014
Deferred tax assets:                
Net operating loss carryforwards   $ 2,415,690     $ 2,307,440  
Start-up cost     320,338       350,834  
Goodwill     738,927       805,100  
Stock based compensation     669,761       621,858  
Other     24       (6,762 )
Deferred tax assets     4,144,741       4,078,470  
Less valuation allowance     (4,144,741 )     (4,078,470 )
Net deferred tax assets after valuation allowance   $ —     $ —  

 

A reconciliation of the U.S. statutory federal income tax rate to the effective income tax rate (benefit) follows:

 

Rate Reconciliation   For the Years ended December 31,
    2015    2014
                 
Federal income tax at statutory rate   $ (145,056 )   $ (192,410 )
State Tax     (15,487 )     (20,543 )
Permanent Differences     542       237  
Other     93,730       16,401  
Change in Valuation Allowance     66,271       196,315  
    $ —     $ —  

 

In assessing the ability to realize a portion of the deferred tax assets, management considers whether it is more than likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities and projected future taxable income in making the assessment. After consideration of the evidence, both positive and negative, management has determined that a $4,144,741 valuation allowance at December 31, 2015 is necessary. The change in the valuation allowance for the current year is $66,271, which represents the changes in the deferred items. At December 31, 2015, the Company has available net operating loss carry forwards for federal income tax purposes of $6,115,670 expiring at various times from 2027 through 2032.

 

Valuation and Qualifying Accounts

 

                     
Description     Balance at Beginning of Period        Charged to Cost and Expenses       Write-offs       Other
Charges		       Balance at
End of Period		  
Deferred tax asset valuation allowance                                        
                                         
Year ended December 31, 2015   $ 4,078,470     $ 66,271     $ —       $ —       $ 4,144,741  
Year ended December 31, 2014   $ 3,882,154     $ 196,316     $ —       $ —       $ 4,078,470