Annual report pursuant to Section 13 and 15(d)

Income Tax Disclosure

Income Tax Disclosure	12 Months Ended
Dec. 31, 2017
Notes
Income Tax Disclosure	NOTE 11 - INCOME TAXES At December 31, 2017 the Company had available net-operating loss carry-forwards for Federal tax purposes of approximately $44,981,000, which may be applied against future taxable income, if any, at various dates from 2017 through 2037. Certain significant changes in ownership of the Company may restrict the future utilization of these tax loss carry-forwards. At December 31, 2017 the Company had a deferred tax asset of approximately $12,145,000 representing the benefit of its net operating loss carry-forwards. The Company has not recognized the tax benefit because realization of the tax benefit is uncertain and thus a valuation allowance has been fully provided against the deferred tax asset. The Company’s Deferred Tax Assets decreased by $3,748,000 from $15,893,000 as of December 31, 2016 to $12,145,000 as of December 31, 2017. The net decrease consisted of an increase in the asset of $2,099,000 as a result of additional Net Operating Losses of $4,589,000 during the current year, offset by a decrease of $5,847,000 resulting from the enactment of the Tax Cuts and Jobs Act (“TCJ Act”) in the fourth quarter of 2017. One of the provisions of the TCJ Act was to decrease the maximum U.S. Corporate income tax rate from 35% to 21%. As a result of this new law the Company will now be calculating its Deferred Tax Assets using a rate of 27% versus 40% in prior years.

Income Tax Disclosure

12 Months Ended

Dec. 31, 2017

NOTE 11 - INCOME TAXES

At December 31, 2017 the Company had available net-operating loss carry-forwards for Federal tax purposes of approximately $44,981,000, which may be applied against future taxable income, if any, at various dates from 2017 through 2037. Certain significant changes in ownership of the Company may restrict the future utilization of these tax loss carry-forwards.

At December 31, 2017 the Company had a deferred tax asset of approximately $12,145,000 representing the benefit of its net operating loss carry-forwards. The Company has not recognized the tax benefit because realization of the tax benefit is uncertain and thus a valuation allowance has been fully provided against the deferred tax asset.

The Company’s Deferred Tax Assets decreased by $3,748,000 from $15,893,000 as of December 31, 2016 to $12,145,000 as of December 31, 2017. The net decrease consisted of an increase in the asset of $2,099,000 as a result of additional Net Operating Losses of $4,589,000 during the current year, offset by a decrease of $5,847,000 resulting from the enactment of the Tax Cuts and Jobs Act (“TCJ Act”) in the fourth quarter of 2017. One of the provisions of the TCJ Act was to decrease the maximum U.S. Corporate income tax rate from 35% to 21%. As a result of this new law the Company will now be calculating its Deferred Tax Assets using a rate of 27% versus 40% in prior years.