|9 Months Ended|
Sep. 30, 2021
NOTE 13 – INCOME TAXES
The effective tax rate was 1.44% and 0% for the nine months ended September 30, 2021 and 2020. The effective tax rate differs from the federal tax rate of 21% for the nine months ended September 30, 2021 and 2020 due primarily to the full valuation allowance, and other discrete items.
At December 31, 2020, the Company had federal and state net operating losses (“NOLs”) in the amount of $483,102 and $483,247, respectively. Federal NOLs do not expire and state NOLs will expire on various dates from 2039 to 2040.
Income tax expense is recorded using the asset and liability method. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to temporary differences between amounts reported for income tax purposes and financial statement purposes, using current tax rates. A valuation allowance is recognized if it is anticipated that some or all of a deferred tax asset will not be realized. The Company must assess the likelihood that its deferred tax assets will be recovered from future taxable income and, to the extent that the Company believes that recovery is not likely, it must establish a valuation allowance. Significant management judgment is required in determining the provision for income taxes, deferred tax assets and liabilities and any valuation allowance recorded against net deferred tax assets.
None of the Company’s Federal or state income tax returns are currently under examination by the Internal Revenue Service (“IRS”), state or foreign tax authorities.
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.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef