In 2017, James Corp's financial statement showed accrued losses on disposal of unused plant facilities of $3,600,000. The facilities were sold in December 2018 and a $3,600,000 loss was recognized for tax purposes then. Also in 2018, James Corp's paid $150,000 for a two-year life insurance policy for their CEO James, and the company was the beneficiary. Assuming that the enacted tax rate is 35% in both 2017 and 2018, and that James paid $1,170,000 in income taxes in 2017.

1) What is the amount reported as net deferred income taxes on James Corp's balance sheet at December 31, 2017 and should it be an asset or Liability?

2) Trump enacted the tax cut and job act in 2018 and effectively changed the corporate tax rate to 21%. For Jame's quarterly financial statement on March 2018,how would this change in tax rate impact Jame's net deferred income taxes?