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EX-4.1 - PROMISSORY NOTE - URBAN AG. CORPurban_10k-ex401.htm
EX-3.4 - AMENDED AND RESTATED CERTIFICATE OF INCORPORATION - URBAN AG. CORPurban_10k-ex304.htm
EX-10.17 - STOCK PURCHASE AGREEMENT WITH DISTRESSED ASSET ACQUISITIONS, INC. - URBAN AG. CORPurban_10k-ex1017.htm
EX-21.1 - LIST OF SUBSIDIARIES - URBAN AG. CORPurban_10k-ex2101.htm
EX-10.13 - STOCK PURCHASE AGREEMENT - URBAN AG. CORPurban_10k-ex1013.htm
EX-10.18 - EMPLOYMENT AGREEMENT - URBAN AG. CORPurban_10k-ex1018.htm
EX-32.1 - CERTIFICATION - URBAN AG. CORPurban_10k-ex3201.htm
EX-31.1 - CERTIFICATION - URBAN AG. CORPurban_10k-ex3101.htm
EX-31.2 - CERTIFICATION - URBAN AG. CORPurban_10k-ex3102.htm
EX-23.1 - CONSENT - URBAN AG. CORPurban_10k-ex2301.htm
EX-10.16 - FACTORING AND SECURITY AGREEMENT WITH MIDLAND AMERICAN CAPITAL - URBAN AG. CORPurban_10k-ex1016.htm
EXCEL - IDEA: XBRL DOCUMENT - URBAN AG. CORPFinancial_Report.xls
10-K - ANNUAL REPORT - URBAN AG. CORPurban_10k-123111.htm
XML - IDEA: XBRL DOCUMENT - URBAN AG. CORPR5.htm
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EX-10.15 - LOAN PURCHASE AND SALE AGREEMENT WITH SUMMITBRIDGE CREDIT INVESTMENTS LLC - URBAN AG. CORPurban_10k-ex1015.htm
v2.4.0.6
13. Income taxes
12 Months Ended
Dec. 31, 2011
Income Tax Disclosure [Abstract]  
13. Income taxes

The significant components of the Company’s deferred income tax liabilities and assets are as follows:

 

   2011   2010 
Deferred tax assets:          
Net operating loss carryforwards  $599,776   $601,968 
Accounts Receivable   60,000      
Accrued expenses   170,704      
Deferred tax liabilities:          
Fixed Assets Depreciation  $(23,432)  $ 
    807,049    601,968 
Less valuation allowance   (807,049)   (601,968)
Net deferred tax assets (liabilities)  $   $ 

 

The CCS businesses had historically elected to be taxed as partnerships. As a partnership, the taxable income passes through to the members each year as earned, and thus the entity pays no federal or state income taxes. The CCS business may make distributions to, or compensate the members in amounts sufficient to pay the income taxes based on their taxable income. During the years ended December 31, 2010 and 2011 prior to its acquisition with Urban Ag, CCS made no distributions for income taxes. Upon the acquisition, the election terminated and the Company became subject to corporate taxation.

 

The Company must make certain estimates and judgments in determining income tax expense for financial statement purposes. These estimates and judgments occur in the calculation of certain tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for tax and financial statement purposes.

          

Under FASB ASC 740, income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. 

            

The Company has approximately $1,500,000 in net operating loss carryovers, prior to the acquisition of CCS, resulting in approximately $600,000 in deferred tax assets .  These carryovers expire at various dates through the year 2030.  The utilization of the Company's net operating losses incurred are strictly limited by the U.S. Internal Revenue Code due to significant changes in ownership of the Company's common stock, changes in business enterprise and other factors.  Management has determined that utilization is not assured, therefore a valuation allowance against the related deferred tax asset has been provided.  Management will continue to evaluate the realizability of the deferred tax asset and its related valuation allowance. If the assessment of the deferred tax assets or the corresponding valuation allowance were to change, then the related adjustment to income would be recorded during the period in which the determination was made. The tax rate may also vary based on the Company's results and the mix of income or loss in domestic tax jurisdictions in which the Company operates.

 

Uncertain Tax Positions 

 

              The Financial Accounting Standards Board issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109, Accounting for Income Taxes" ("FIN No. 48") which was effective for the Company on January 1, 2007.  FIN No. 48 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements.  Under FIN No. 48, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position.  The tax benefits recognized in the financial statements from such position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement.  FIN No. 48 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure requirements.  The company has not had a tax audit for its open tax years 2008 through 2011.