Income Taxes

12 Months Ended

Dec. 31, 2011

(5) Income Taxes

The components of income tax expense for the years ended December 31, 2011 and 2010 are as follows:

	2011	2010

Current	$ -	$ 112,860
Deferred	(68,271)	141,000
Change in valuation allowance	68,271	-
Use of operating loss carryforward	-	(253,860)

	$ -	$ -

The difference between income tax expense computed by applying the statutory federal income tax rate to earnings before taxes for the years ended December 31, 2011 and 2010 is as follows:

	2011	2010

Pretax earnings (loss) at statutory rate	$ (61,735)	$ 229,554
State income tax (benefit), net of federal benefit	(6,536)	24,306
Change in valuation allowance	68,271	-
Use of operating loss carryforward	-	(253,860)

	$ -	$ -

The components of deferred taxes at December 31, 2011and 2010 are as follows:

	2011	2010

Deferred income tax assets:
Operating loss carryforwards	$ 373,600	$ 298,279
Deferred revenue	133,950	141,000

Total gross deferred income tax assets	507,550	439,279

Less valuation allowance	(507,550)	(439,279)

Net deferred tax	$ -	$ -

During 2011 and 2010, a valuation allowance was established for the entire amount of the net deferred tax asset as the realization of the deferred tax asset is dependent on future taxable income.

At December 31, 2011, the Company had net operating loss carryforwards for tax purposes of approximately $1.3 million which will expire beginning in 2022, if not previously utilized.

- Definition

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.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

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Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 109

-Paragraph 136, 172

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 109

-Paragraph 43, 44, 45, 46, 47, 48, 49

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Regulation S-X (SX)

-Number 210

-Section 08

-Paragraph h

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Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 740

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-Section 50

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-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319

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-Publisher FASB

-Name Accounting Standards Codification

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-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

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-Name Accounting Standards Codification

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+ Details

WOODSTOCK HOLDINGS INC. 10-K