NOTE 4 - INCOME TAXES | NOTE 4 - INCOME TAXES The Company follows FASB ASC 740-10-10 whereby an entity recognizes deferred tax assets and liabilities for future tax consequences or events that have been previously recognized in the Company’s financial statements or tax returns. The measurement of deferred tax assets and liabilities is based on provisions of enacted tax law. The effects of future changes in tax laws or rates are not anticipated. The Company does not conduct business in Delaware and is not required to file a Delaware corporate income tax return, thus, there is no state income tax provision (benefit) or state deferred assets or liabilities. The income tax (benefit) provision consists of the following: Year Ended December 31, 2020 2019 Loss before income tax $ (62,939 ) $ (3,385 ) Tax rate 21 % 21 % Income tax expense (benefit) at statutory rate (13,217 ) (711 ) Change in valuation allowance 13,217 711 Income tax expense (benefit) $ - $ - Deferred taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts recorded for tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows: As of December 31, 2020 2019 NOL Carryover 58,911 45,694 Valuation allowance (58,911 ) (45,694 ) Net deferred tax asset $ - $ - The reconciliation of the effective income tax rate to the U.S. federal statutory rate as of December 31, 2020 and 2019: As of December 31, 2020 2019 Federal income tax rate 21 % 21 % Increase in valuation allowance (21 %) (21 %) Effective income tax rate 0.0 % 0.0 % At December 31, 2020, the Company had $280,000 of the U.S. net operating losses (the “U.S. NOLs”), which begin to expire beginning in 2033. NOLs generated in tax years prior to December 31, 2018, can be carryforward for twenty years, whereas NOLs generated after December 31, 2018 can be carryforward indefinitely. The Company assesses the likelihood that deferred tax assets will not be realized. FASB ASC Topic 740, “Income Taxes” requires that a valuation allowance be established when it is “more likely than not” that all, or a portion of, deferred tax assets will not be realized. A review of all available positive and negative evidence needs to be considered, including the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies. After consideration of all the information available, management believes that uncertainty exists with respect to future realization of its deferred tax assets and has, therefore, established a full valuation allowance as of December 31, 2020 and 2019. The Company’s policy is to record interest and penalties associated with unrecognized tax benefits as additional income taxes in the statement of operations. As of January 1, 2020, the Company had no unrecognized tax benefits and no charge during 2020, and accordingly, the Company did not recognize any interest or penalties during 2020 related to unrecognized tax benefits. There is no accrual for uncertain tax positions as of December 31, 2020. The Company has not completed its evaluation of NOL utilization limitation under IRC Section 382, change of ownership rules, but believes that it had a change of ownership that would limit the amount of U.S. NOLs that could be utilized each year based on the “Internal Revenue Code, as Amended.” The last year that the Company filed it's income tax returns was for the tax year ended December 31, 2019. The Company’s tax returns are subject to examination by tax authorities beginning with the year ended December 31, 2016. |