Income Taxes

12 Months Ended

Dec. 31, 2020

8. Income taxes

The Company did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because it has experienced operating losses. When it is more likely than not that a tax asset cannot be realized through future income, the Company must take a full valuation allowance for this future tax benefit. The Company provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carryforwards, because management has determined that it is more likely than not that the Company will not earn income sufficient to realize the deferred tax assets during the carryforward period.

The Company has not taken a tax position that, if challenged, would have a material effect on the financial statements for the year ended December 31, 2020, or during the prior three years applicable under FASB ASC 740. The Company did not recognize any adjustment to the liability for uncertain tax position and therefore did not record any adjustment to the beginning balance of accumulated deficit on the balance sheet. All tax returns have been appropriately filed by the Company.

Income tax provision at the federal statutory rate	21	%
Effect of operating losses	(21	)%
	-	%

Net deferred tax assets consist of the following:

	December 31, 2020			December 31, 2019

Net operating loss carry forward	$	447,024		$	274,926
Valuation allowance		(447,024	)		(274,926	)
Net deferred tax asset	$	-		$	-

A reconciliation of income taxes computed at the statutory rate is as follows:

	Year ended
	December 31,
	2020			2019

Tax at statutory rate (21%)	$	172,098		$	256,121
Non-deductible expenses		-			(96,272	)
Increase in valuation allowance		(172,098	)		(158,849	)
Income tax expenses	$	-		$	-

The Company did not pay any income taxes during the year ended December 31, 2020 or 2019.

- 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 + Details

QHY GROUP 10-K