| INCOME TAXES |
NOTE
6—INCOME TAXES
The
Company’s income tax expense and effective tax rates for the six and three months ended June 30, 2026 and 2025 were as follows:
SCHEDULE
OF INCOME TAX EXPENSE AND EFFECTIVE TAX RATES
| | |
2026 | | |
2025 | | |
2026 | | |
2025 | |
| | |
Six Months Ended June 30, | | |
Three Months Ended June 30, | |
| | |
2026 | | |
2025 | | |
2026 | | |
2025 | |
| Income tax expense | |
| - | | |
| - | | |
| - | | |
| - | |
| Effective tax rate | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % |
The
Company’s income tax provision differs from the expense that would result from applying statutory rates to income (loss) before
taxes. A reconciliation of the provision (benefit) for income taxes with amounts determined by applying the statutory U.S. federal income
tax rate to income before income taxes is as follows (unaudited):
SCHEDULE OF INCOME BEFORE INCOME TAXES
| | |
Amount | | |
Tax Rate | | |
Amount | | |
Tax Rate | |
| | |
Six Months Ended June 30, | |
| | |
2026 | | |
2025 | |
| | |
Amount | | |
Tax Rate | | |
Amount | | |
Tax Rate | |
| Computed tax at the federal statutory rate of 21% | |
$ | (29,571 | ) | |
| 21.00 | % | |
$ | 534,720 | | |
| 21.00 | % |
| Increase (decrease) in income tax rate resulting from: | |
| | | |
| | | |
| | | |
| | |
| Nondeductible/nontaxable items | |
| | | |
| | | |
| | | |
| | |
| Interest- related party, note discount and limitation | |
| 21,195 | | |
| (15.05 | )% | |
| 34,432 | | |
| 1.35 | % |
| Other | |
| (14,482 | ) | |
| 10.28 | % | |
| (108,295 | ) | |
| (4.25 | )% |
| State income taxes, net of federal income tax benefit | |
| (6,125 | ) | |
| 4.35 | % | |
| 110,763 | | |
| 4.35 | % |
| Permanent difference - relief of indebtedness income | |
| - | | |
| 0.00 | % | |
| (356,375 | ) | |
| (14.00 | )% |
| Change in federal valuation allowance | |
| 28,983 | | |
| (20.58 | )% | |
| (215,245 | ) | |
| (8.45 | )% |
| Total provision for income tax | |
$ | - | | |
| 0.00 | % | |
$ | - | | |
| 0.00 | % |
| | |
Amount | | |
Tax Rate | | |
Amount | | |
Tax Rate | |
| | |
Three Months Ended June 30, | |
| | |
2026 | | |
2025 | |
| | |
Amount | | |
Tax Rate | | |
Amount | | |
Tax Rate | |
| Computed tax at the federal statutory rate of 21% | |
$ | (18,017 | ) | |
| 21.00 | % | |
$ | 578,235 | | |
| 21.00 | % |
| Increase (decrease) in income tax rate resulting from: | |
| | | |
| | | |
| | | |
| | |
| Nondeductible/nontaxable items | |
| | | |
| | | |
| | | |
| | |
| Interest- related party, note discount and limitation | |
| 10,681 | | |
| (12.45 | )% | |
| 10,777 | | |
| 0.39 | % |
| Other | |
| (14,483 | ) | |
| 16.88 | % | |
| (84,640 | ) | |
| (3.07 | )% |
| State income taxes, net of federal income tax benefit | |
| (3,733 | ) | |
| 4.35 | % | |
| 119,777 | | |
| 4.35 | % |
| Permanent difference - relief of indebtedness income | |
| - | | |
| 0.00 | % | |
| (356,375 | ) | |
| (12.94 | )% |
| Change in federal valuation allowance | |
| 25,552 | | |
| (29.78 | )% | |
| (267,774 | ) | |
| (9.72 | )% |
| Total provision for income tax | |
$ | - | | |
| 0.00 | % | |
$ | - | | |
| 0.00 | % |
|