INCOME TAXES

12 Months Ended

Jun. 30, 2016

A reconciliation of the provision for income taxes at the United States federal statutory rate compared to the Company’s income tax expense as reported is as follows:

	June 30, 2016			June 30, 2015

Net loss before income taxes	$	(10,593	)	$	(4,525	)
Income tax rate		34	%		34	%
Income tax recovery		(3,602	)		(1,539	)
Non-deductible		--			-
Valuation allowance change		3,602			1,539

Provision for income taxes	$	–		$	–

The significant components of deferred income tax assets at June 30, 2016 and 2015 are as follows:

	June 30, 2016			June 30, 2015
Net operating loss carry-forward	$	7,625		$	4,023
Valuation allowance		(7,625	)		(4,023	)

Net deferred income tax asset	$	–		$	–

The amount taken into income as deferred income tax assets must reflect that portion of the income tax loss carry forwards that is more likely-than-not to be realized from future operations. The Company has chosen to provide a full valuation allowance against all available income tax loss carry forwards. The Company has recognized a valuation allowance for the deferred income tax asset since the Company cannot be assured that it is more likely than not that such benefit will be utilized in future years. The valuation allowance is reviewed annually. When circumstances change and which cause a change in management's judgment about the realizability of deferred income tax assets, the impact of the change on the valuation allowance is generally reflected in current income.

As of June 30, 2016 and 2015, the Company has no unrecognized income tax benefits. The Company’s policy for classifying interest and penalties associated with unrecognized income tax benefits is to include such items as tax expense. No interest or penalties have been recorded during the year ended June 30, 2016 and 2015 no interest or penalties have been accrued as of June 30, 2016 and 2015. As of June 30, 2016 and 2015, the Company did not have any amounts recorded pertaining to uncertain tax positions.

The tax years from 2014 and forward remain open to examination by federal and state authorities due to net operating loss and credit carryforwards. The Company is currently not under examination by the Internal Revenue Service or any other taxing authorities.

Gen Serv, INC. 10-K