Income Taxes

3 Months Ended

Dec. 31, 2014

Note 7 - Income Taxes

The components of income tax (benefit) expense for each of the three months ended December 31, 2014 and 2013and for the period from July 5, 1989 (date of inception) through December 31, 2014 – (unaudited), are as follows:

Period from

July 5, 1989

Three months ended

(date of inception) through

December 31, 2014

December 31, 2013

December 31, 2014

Federal:

Current

—

Deferred

—

State:

Current

—

Deferred

—

Total

—

As of December 31, 2014, as a result of the September 2013 change in control transaction, the Company has a net operating loss carryforward of approximately $-0- to offset future taxable income. The amount and availability of any net operating loss carryforwards will be subject to the limitations set forth in the Internal Revenue Code. Such factors as the number of shares ultimately issued within a three year look-back period; whether there is a deemed more than 50 percent change in control; the applicable long-term tax exempt bond rate; continuity of historical business; and subsequent income of the Company all enter into the annual computation of allowable annual utilization of any net operating loss carryforward(s).

The Company’s income tax expense (benefit) for the three months ended December 31, 2014 and 2013 and for the period from July 5, 1989 (date of inception) through December 31, 2014, respectively, differed from the statutory federal rate of 34 percent as follows:

							Period from
							July 5, 1989
	Three months ended			Three months ended			(date of inception) through
	December 31, 2014			December 31, 2013			December 31, 2014

Statutory rate applied to income before income taxes
Increase (decrease) in income taxes resulting from:	$	(6,100	)	$	(3,700	)	$	(6,100	)
State income taxes		—			—			—
Other, including nondeductible change in control transaction expenses and application of net operating loss carryforward		6,100			3,700			6,100

Income tax expense	$	—		$	—		$	—

Temporary differences, consisting primarily of statutory deferrals of expenses for organizational costs, statutory differences in the depreciable/amortizable lives for property and equipment and patents and the recognition of expense charges related to the issuance of warrants, between the financial statement carrying amounts and tax bases of assets and liabilities give rise to deferred tax assets and/or liabilities. As of December 31, 2014 and September 30, 2014, respectively, after taking the September 2013 change in control into consideration:

	December 31, 2014			September 30, 2014
				(audited)
Deferred tax assets
Net operating loss carryforwards	$	25,100		$	19,000
Less valuation allowance		(25,100	)		(19,000	)

Net Deferred Tax Asset	$	—		$	—

During each of the three months ended December 31, 2014 and 2013, the valuation allowance for the deferred tax asset increased by approximately $25,100 and $10,900, respectively.

JD International Ltd 10-Q