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Income Taxes
 12 Months Ended
Dec. 31, 2021
Income Tax [Abstract]  
Income Taxes

Note 8—Income Taxes

 

The Company’s taxable income primarily consists of interest income on the Trust Account. The Company’s general and administrative expenses are generally considered start-up costs and are not currently deductible. There was no income tax expense for the year ended December 31, 2021 and for the period from April 17, 2020 (inception) through December 31, 2020.

 

The income tax provision (benefit) consists of the following for the year ended December 31, 2021 and for the period from April 17, 2020 (inception) through December 31, 2020:

 

   For the
Year Ended
December 31,
2021		   For the
Period
from April
17,
2020
(Inception)
through
December 31,
2020		 
Current        
Federal  $
            -
   $
                -
 
State   
-
    
-
 
Deferred          
Federal   (638,081)   
-
 
State   
-
    
-
 
Change in valuation allowance   638,081    
-
 
Income tax provision expense  $
-
   $
-
 

 

The Company’s net deferred tax assets are as follows as of December 31, 2021 and 2020:

 

   December 31, 
   2021   2020 
Deferred tax asset        
Startup/Organizational Costs  $566,509   $
-
 
Deferred Compensation   33,805      
Net operating loss carryforwards   37,767    
-
 
Total deferred tax assets   638,081    
-
 
Valuation allowance   (638,081)   
-
 
Deferred tax asset, net of allowance  $
-
   $
-
 

 

In assessing the realization of deferred 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 temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax assets, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance.

 

There were no unrecognized tax benefits as of December 31, 2021 and 2020. No amounts were accrued for the payment of interest and penalties as of December 31, 2021 and 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.

 

A reconciliation of the statutory federal income tax rate (benefit) to the Company’s effective tax rate (benefit) is as follows for the year ended December 31, 2021 and for the period from April 17, 2020 (inception) through December 31, 2020:

 

   For the Year
Ended
December 31,
2021		   For the
Period from
April 17,
2020
(Inception)
through
December 31,
2020		 
Statutory Federal income tax rate   21.0%   
-
%
Change in fair value of warrant liability   (12.2)%   
-
 
Change in fair value of FPS liability   (5.2)%   
-
 
Change in valuation allowance   (3.6)%   
-
 
Income Taxes Benefit   0.0%   0.0%