Annual report [Section 13 and 15(d), not S-K Item 405]

Income tax

v3.25.1
Income tax
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income tax

Note 18 – Income tax

 

The provision (benefit) for income taxes for the years ended December 31, 2024 and 2023 consist of the following:

 

    2024     2023  
Current taxes from continuing operations:                
Federal   $ -     $ -  
State     15,329       8,160  
Total current     15,329     8,160  
                 
Taxes from discontinued operations(1):                
Federal   -       -  
State   -       5,783  
Tax provision plus discontinued operations (1)   15,329       13,943  
                 
Deferred tax asset:                
Federal     98,300       (273,400 )
State     (156,600 )     1,100  
Change in valuation     58,300     (272,300 )
Total provision (benefit)   $ 15,329     $ 13,943  

 

(1) We sold our entire ownership interest in WCI on October 4, 2023 and as a result WCI is excluded from our continuing operations and presented as discontinued operations. See Note 3.

 

The Company has net deferred tax assets resulting from a timing difference in recognition of depreciation and reserves for uncollectible accounts receivable and from net operating loss carryforwards.

 

 

Mentor Capital, Inc.

Notes to Consolidated Financial Statements

December 31, 2024 and 2023

 

At December 31, 2024, the Company had approximately $6,500,000 of federal net operating loss carryforwards, of which approximately $3,700,000 can be carried forward indefinitely, and the remaining $2,800,000 will begin to expire in 2034 and be fully expired by the year 2037. The Company has a California net operating loss carryforward of approximately $7,100,000 that begins expiring in 2025. Mentor relocated to Texas in September 2020, and the Company’s ability to utilize the California net operating loss carryforwards is dependent on the future generation of California taxable income.

 

The income tax provision (benefit) differs from the amount computed by applying the U.S. federal statutory corporate income tax rate of 21% in 2024 and 2023, respectively, to net income (loss) before income taxes for the years ended December 31, 2024 and 2023 as a result of the following:

 

    2024     2023  
Net income (loss) before income tax - continuing operations   $ (824,176 )   $ 3,087,919  
US federal income tax rate     21 %     21 %
                 
Computed expected tax (benefit) - continuing operations     (173,077 )     648,463  
                 
Net Income (loss) before income tax - discontinued operations (1)     -       83,682  
US federal income tax rate     21 %     21 %
Computed expected tax (benefit) - discontinued operations     -       17,573  
                 
Total computed expected tax (benefit)     (173,077 )     666,036  
Permanent differences and other   114,777       (393,736 )
Change in valuation     58,300     (272,300 )
Federal income tax provision   $ -     $ -  

 

(1) We sold our entire ownership interest in WCI on October 4, 2023 and as a result WCI is excluded from our continuing operations and presented as discontinued operations. See Note 3.

 

 

Mentor Capital, Inc.

Notes to Consolidated Financial Statements

December 31, 2024 and 2023

 

The significant components of deferred income tax assets as of December 31, 2024 and 2023 after applying enacted corporate income tax rates are as follows:

 

    2024     2023  
Net Operating Losses carried forward from continuing operations   $ 1,957,000     $ 1,913,000  
Capital Losses carried forward     -       156,600  
Deferred - Other     54,000       -  
Valuation allowance     (2,011,000 )     (2,069,600 )
Deferred tax assets   $ -     $ -  

 

The Company files income tax returns in the U.S. federal jurisdiction and various state and local jurisdictions. All tax years from 2020 to 2023 are subject to examination.