INCOME TAXES |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| INCOME TAXES |
NOTE 16. INCOME TAXES
The Company records income taxes using the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax effects attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases, and operating loss and tax credit carryforwards. The Company establishes a valuation allowance if management believes it is more likely than not that the deferred tax assets will not be recovered based on an evaluation of objective verifiable evidence. Management has considered the Company’s history of book and tax income and losses incurred since inception, and the other positive and negative evidence, and has concluded that it is more likely than not that the Company will not realize the benefits of the net deferred tax assets as of September 30, 2025. As of September 30, 2025, the Company had no unrecognized tax benefits and does not anticipate any significant change to the unrecognized tax benefit balance. On July 4, 2025, the reconciliation bill, commonly referred to as the “One Big Beautiful Bill Act” (OBBBA) was signed into law. Beginning in 2025, the OBBBA provides an elective deduction for domestic research and experimental expenditures, a permanent reinstatement of elective 100% first-year bonus depreciation, changes to the Section 163(j) interest limitations, and expanded Section 162(m) aggregation requirements. In 2025, the Company does not expect the OBBBA to have a material impact on its income tax provision due to the valuation allowance maintained against our net deferred tax assets. The Company will continue to monitor the impact of the OBBBA, which may depend on our facts in each year and anticipated guidance from the U.S. Department of the Treasury. |
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