Focus Universal Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Note 6

Note 6

12 Months Ended

Mar. 31, 2014

Income Tax Disclosure [Abstract]

Note 6

Note 6 Income Tax

Deferred Tax Assets

At March 31, 2014, the Company had net operating loss (NOL) carryforwards for Federal income tax purposes of $22,854 that may be offset against future taxable income through 2033.

No tax benefit has been reported with respect to these net operating loss carry-forwards in the accompanying financial statements because the Company believes that the realization of the Companys net deferred tax assets of approximately $3,428, was not considered more likely than not and accordingly, the potential tax benefits of the net loss carry-forwards are fully offset by a valuation allowance.

Components of deferred tax assets at March 31, 2014 and 2013 are as follows:


	March 31, 2014			March 31, 2013
Net deferred tax assets Non-current:
Expected income tax benefit from NOL carry-forwards	$	3,428		$	352
Less valuation allowance		(3,428	)		(352	)
Deferred tax assets, net of valuation allowance	$	-		$	-

Deferred tax assets consist primarily of the tax effect of NOL carry-forwards. The Company has provided a full valuation allowance on the deferred tax assets because of the uncertainty regarding its realizability. The valuation allowance increased approximately $3,076 during the year ended March 31, 2014 and $352 for the period from December 4, 2012 (Inception) to March 31, 2013 respectively.

Income Tax Provision in the Statements of Operations

A reconciliation of the federal statutory income tax rate and the effective income tax rate as a percentage of income before income taxes is as follows:

	For the Year Ended March 31, 2014	For the Period From December 4, 2012 (Inception) to March 31, 2013

Federal statutory income tax rate	15.0 %	15.0 %
Change in valuation allowance on net operating loss carry-forwards	(15.0)%	(15.0)%
Effective income tax rate	0.00 %	0.00 %

- 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.

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