INCOME TAXES |
3 Months Ended |
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Mar. 31, 2025 | |
| INCOME TAXES | |
| INCOME TAXES |
NOTE 17. INCOME TAXES The Company’s U.S. federal statutory tax rate is 21% and its foreign operations have statutory tax rates of approximately 23% in Austria, 28% in New Zealand, and 30% in Australia. The difference between the Company’s estimated effective tax rate benefit of 13.3% for the three months ended March 31, 2025, and the U.S. federal statutory tax rate of 21% was primarily due to the impact of valuation allowance, stock compensation, and research and experimentation expenditures and credits in the first quarter of 2025. As of December 31, 2024, the Company’s gross deferred tax asset was $35,658. The Company has recorded a valuation allowance of $23,344, resulting in a net deferred tax asset of $12,314, before deferred tax liabilities of $24,488. As of March 31, 2025 and December 31, 2024, the Company has provided a full valuation allowance against all of the U.S. deferred tax assets because the ultimate realization of those assets did not meet the more-likely-than-not criteria. Part of the Company’s deferred tax assets consist of net operating loss carryforwards (“NOLs”) for federal tax purposes. If a change in control were to occur, these could be limited under Section 382 of the Internal Revenue Code of 1986 (“Code”), as amended. In assessing the realizability of deferred income tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible and net operating loss and credit carryforwards expire. The estimates and judgments associated with the Company’s valuation allowance on deferred tax assets are considered critical due to the amount of deferred tax assets recorded by the Company on its consolidated balance sheets and the judgment required in determining the Company’s future taxable income. The need for a valuation allowance is reassessed at each interim reporting period. As of December 31, 2024, the Company had NOLs and research and experimentation credit for U.S. federal income tax purposes of $0 and $5,439, respectively.
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