XML 34 R16.htm IDEA: XBRL DOCUMENT
v3.25.4

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2025
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The reconciliation of income tax expense recorded in the consolidated statement of operations and amounts computed at the statutory federal income tax rate for the years ended December 31, 2025, 2024 and 2023, were as follows:
| December 31, 2025 |  | December 31, 2024 |  | December 31, 2023
| Amount |  | Percentage |  | Amount |  | Percentage |  | Amount |  | Percentage
Loss before tax at statutory federal rate | $ | (201) |  |  | 21.0 | % |  | $ | (26,891) |  |  | 21.0 | % |  | $ | (31,121) |  |  | 21.0 | %
State and local income taxes, net of federal income tax effect | 221 |  |  | (23.0) |  |  | 1,815 |  |  | (1.4) |  |  | 1,133 |  |  | (0.8) |
Enactment of new tax laws | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Effect of cross-border tax laws | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Tax credits | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Change in valuation allowance | 517 |  |  | (53.9) |  |  | 17,107 |  |  | (13.4) |  |  | 23,955 |  |  | (16.1) |
Nondeductible Items |  |  |  |  |  |  |  |  |  |  |
Stock Compensation | (6,271) |  |  | 653.6 |  |  | — |  |  | — |  |  | — |  |  | — |
Nondeductible executive compensation | 6,518 |  |  | (679.8) |  |  | 8,703 |  |  | (6.8) |  |  | 6,716 |  |  | (4.5) |
Nondeductible entertainment | 159 |  |  | (16.6) |  |  | 138 |  |  | (0.2) |  |  | 48 |  |  | — |
Other | 193 |  |  | (20.3) |  |  | 43 |  |  | — |  |  | 120 |  |  | (0.1) |
Worldwide changes in unrecognized tax benefits | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Other |  |  |  |  |  |  |  |  |  |  |
Federal deferred tax adjustments | (1,941) |  |  | 202.4 |  |  | 844 |  |  | (0.7) |  |  | (947) |  |  | 0.6 |
Federal tax return true-up | 825 |  |  | (86.0) |  |  | (1,738) |  |  | 1.4 |  |  | 74 |  |  | — |
Foreign Tax Effects |  |  |  |  |  |  |  |  |  |  |
Total | $ | 20 |  |  | (2.6) | % |  | $ | 21 |  |  | (0.1) | % |  | $ | (22) |  |  | 0.1 | %
In each year, California comprised the majority of the state and local income taxes, net of federal effect. The cash paid for income taxes (net of refunds) during the year was as follows:
| December 31, 2025 |  | December 31, 2024 |  | December 31, 2023
Federal | $ | — |  |  | $ | — |  |  | $ | — |
State and local |  |  |  |  |
California | 6 |  |  | — |  |  | 190 |
Colorado | 5 |  |  | 7 |  |  | — |
Massachusetts | 7 |  |  | 4 |  |  | — |
New Jersey | 2 |  |  | 2 |  |  | — |
Other | 5 |  |  | 7 |  |  | 15 |
Total state and local | 25 |  |  | 20 |  |  | 205 |
Total | $ | 25 |  |  | $ | 20 |  |  | $ | 205 |
The components of deferred income taxes as of December 31, 2025 and 2024, were as follows:
| December 31, 2025 |  | December 31, 2024
Deferred tax assets: |  |  |
Federal and state net operating loss carryforwards | $ | 178,835 |  |  | $ | 169,044 |
Employee benefits | 12,151 |  |  | 8,278 |
Interest deduction limitation | 4,851 |  |  | 11,661 |
Other | 1,930 |  |  | 3,330 |
R&D credits | 839 |  |  | — |
ROU lease liabilities | 2,314 |  |  | 2,446 |
Stock compensation | 48,053 |  |  | 48,416 |
Total deferred tax assets | 248,973 |  |  | 243,175 |
Deferred tax liabilities: |  |  |
Intangibles | (6,127) |  |  | (1,404) |
Depreciation | (1,453) |  |  | (214) |
ROU assets | (1,950) |  |  | (2,105) |
Other | (80) |  |  | (31) |
Total deferred tax liabilities | (9,610) |  |  | (3,754) |
Valuation allowance | (239,363) |  |  | (239,421) |
Net deferred taxes | $ | — |  |  | $ | — |
Valuation allowances are provided when it is considered more likely than not that deferred tax assets will not be realized. The valuation allowances primarily relate to future tax benefits on certain federal and state net operating loss (“NOL”) carryforwards. For the years ended December 31, 2025 and 2024, federal NOL carryforwards were $617,001 and $565,838, respectively. For the years ended December 31, 2025 and 2024, state NOL carryforwards were $531,012 and $543,513, respectively, and $95,332 of the total federal net operating loss carryforwards have an indefinite life while the remaining federal and state net operating loss carryforwards begin to expire in 2033 if not utilized. Of the total NOL carryforwards, approximately $19,031 of federal and $13,221 of California NOL carryforwards relate to Alignment Health Plan, Inc. for which the utilization of the federal NOL carryforward is subject to a federal Section 382 limitation of $870 per year, and the utilization of the California NOL carryforwards is subject to a similar California annual limitation. In June 2024, California’s Governor signed into law Assembly Bill (“AB”) 167 suspending California NOL utilization for taxpayers with more than $1 million of taxable income, effective for tax years 2024, 2025, and 2026. AB 167 includes an extended carryover period for suspended NOLs that would have been utilized if not for AB 167. We have cumulative NOLs as of December 31, 2025 and 2024. Given the history of losses, and after consideration for the risk associated with estimates of future taxable income, we established a full valuation allowance against net deferred tax assets at December 31, 2025 and 2024. Under the Tax Cuts and Jobs Act (“TCJA”), federal NOLs generated after 2017 will be carried forward indefinitely but are limited to an 80% deduction of taxable income. NOLs generated prior to 2018 have a 20-year carryforward period and can be used to offset 100% of taxable income. An exception to the TCJA federal NOL rule applies to certain of our subsidiaries and requires all NOLs generated from those entities to have a 20-year carryforward period and offset 100% of taxable income. Additionally, an “ownership change” as defined under Section 382 of the Internal Revenue Code, could potentially limit the ability to utilize certain tax attributes including the Company’s substantial NOLs. Ownership change is generally defined as any significant change in ownership of more than 50% of its stock over a three-year testing period. If, as a result of current or future transactions involving our common stock, we undergo cumulative ownership changes which exceed 50% over the testing period, our ability to utilize our NOL carryforwards would be subject to additional limitations under IRC Section 382. We continue to monitor changes in ownership with respect to these income tax provisions. We record uncertain tax positions in accordance with ASC 740, on the basis of a two-step process in which (i) we determine whether it is more likely than not a tax position will be sustained on the basis of the technical merits of such position and (ii) for those tax positions meeting the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50.0% likely to be realized upon ultimate settlement with the related tax authority. The following table summarizes the gross amount of our uncertain tax positions:
| December 31, 2025
Gross unrecognized tax benefits at the beginning of the year | $ | — |
Increases related to prior year tax positions | $ | 1,019 |
Increases from tax positions taken in the current year | $ | 192 |
Gross unrecognized tax benefits at the end of the year | $ | 1,211 |
Due to the existence of the valuation allowance, future changes in our unrecognized tax benefits will not impact our effective tax rate. Our policy is to recognize interest and penalties related to income tax matters as a component of income tax expense. As of December 31, 2025, no interest and penalties have been recognized. The One Big Beautiful Bill Act (“OBBB Act”) was enacted on July 4, 2025 in the United States. The OBBB Act includes several significant provisions, including re-establishing a 100% bonus depreciation deduction, re-establishing rules in calculating business interest expense limitations pursuant to §163(j), and removing the capitalization requirements for domestic research or experimental (“R&E”) expenditures paid or incurred in tax years beginning after December 31, 2024. We have considered applicable tax impacts of the OBBB Act within the 2025 financial statements.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income tax. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 942 -SubTopic 740 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147477617/942-740-50-1 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480738/235-10-S50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 944 -SubTopic 740 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478822/944-740-50-1 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12 Reference 5: http://www.xbrl.org/2003/role/exampleRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 231 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482663/740-10-55-231 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12C -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12B -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477891/740-270-50-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-13 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/740/tableOfContent Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-14 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-21 Reference 15: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-17 Reference 16: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2 Reference 17: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration