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Income Taxes | 12 Months Ended
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Dec. 28, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | 8. Income Taxes The provision for income taxes from continuing operations consists of the following for the fiscal years indicated: Schedule of Components of Income Tax Expense (Benefit)
|  | 2024 |  |  | 2023 |  |  | 2022 |
|  | Fiscal Year |
|  | 2024 |  |  | 2023 |  |  | 2022 |
Current |  |  |  |  |  |  |  |  |  |  |  |
State |  | $ | — |  |  | $ | — |  |  | $ | — |
Foreign |  |  | 170,000 |  |  |  | 156,000 |  |  |  | 144,000 |
Total current provision |  |  | 170,000 |  |  |  | 156,000 |  |  |  | 144,000 |
Deferred |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | (6,902,000 | ) |  |  | (3,457,000 | ) |  |  | 1,073,000 |
State |  |  | (506,000 | ) |  |  | (1,063,000 | ) |  |  | (1,561,000 | )
Foreign |  |  | (218,000 | ) |  |  | (281,000 | ) |  |  | 74,000 |
Change in valuation allowance |  |  | 7,626,000 |  |  |  | 4,801,000 |  |  |  | 414,000 |
Total deferred provision |  |  | — |  |  |  | — |  |  |  | — |
Total provision for income taxes |  | $ | 170,000 |  |  | $ | 156,000 |  |  | $ | 144,000 |
The following table sets forth the changes in the Company’s balance of unrecognized tax benefits for the year ended: Schedule of Unrecognized Tax Benefit
|  | Total |
Unrecognized tax benefits at December 31, 2022 |  | $ | 394,000 |
Gross increases—prior year tax positions |  |  | — |
Unrecognized tax benefits at December 30, 2023 |  |  | 394,000 |
Gross increases—current year tax positions |  |  | — |
Unrecognized tax benefits at December 28, 2024 |  | $ | 394,000 |
U.S. GAAP requires applying a ‘more likely than not’ threshold to the recognition and derecognition of uncertain tax positions either taken or expected to be taken by the Company’s income tax returns. The total amount of the Company’s gross tax liability for tax positions that may not be sustained under a ‘more likely than not’ threshold amounts to $0.4 million as of December 28, 2024 and December 30, 2023. The Company’s policy regarding the classification of interest and penalties is to include these amounts as a component of income tax expense. The total amount of accrued interest and penalties related to the Company’s unrecognized tax benefits was $1.2 million and $1.0 million as of December 28, 2024 and December 30, 2023, respectively, located in other long-term liabilities, net of current position. Net operating losses were not utilized in 2024, 2023 and 2022 to offset federal and state taxes. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The actual income tax provisions reported from operations are different from those which would have been computed by applying the federal statutory tax rate to loss before income tax provision. A reconciliation of income tax provision from continuing operations as computed at the U.S. federal statutory income tax rate to the provision for income tax benefit is as follows: Schedule of Effective Income Tax Rate Reconciliation
|  | 2024 |  |  | 2023 |  |  | 2022 |
|  | Fiscal Year |
|  | 2024 |  |  | 2023 |  |  | 2022 |
Tax provision at federal statutory rates |  | $ | (9,201,000 | ) |  | $ | (4,113,000 | ) |  | $ | (4,029,000 | )
Foreign tax rate differential |  |  | 30,000 |  |  |  | 13,000 |  |  |  | (8,000 | )
Equity compensation awards |  |  | (136,000 | ) |  |  | 450,000 |  |  |  | 44,000 |
Permanent items |  |  | 176,000 |  |  |  | (79,000 | ) |  |  | — |
Expiration of net operating loss carryforwards |  |  | 3,286,000 |  |  |  | — |  |  |  | 5,218,000 |
Increase in net state operating loss carryforwards |  |  | (2,119,000 | ) |  |  | (780,000 | ) |  |  | (987,000 | )
Utilization of net operating losses for U.K. research and development refund |  |  | — |  |  |  | — |  |  |  | (24,000 | )
Provision to tax return adjustments and tax rate change |  |  | 268,000 |  |  |  | (270,000 | ) |  |  | (36,000 | )
Tax credits |  |  | 106,000 |  |  |  | 14,000 |  |  |  | (441,000 | )
Equity compensation |  |  | — |  |  |  | — |  |  |  | (188,000 | )
Uncertain tax position for transfer pricing |  |  | 169,000 |  |  |  | 156,000 |  |  |  | 143,000 |
Other, net |  |  | (35,000 | ) |  |  | (36,000 | ) |  |  | 38,000 |
Change in valuation allowance |  |  | 7,626,000 |  |  |  | 4,801,000 |  |  |  | 414,000 |
Total provision |  | $ | 170,000 |  |  | $ | 156,000 |  |  | $ | 144,000 |
Pretax foreign (loss) income from continuing operations was approximately $(1.5) million for the fiscal year ended 2024, $(0.6) million for fiscal year ended 2023, and $0.4 million for fiscal year ended 2022. Deferred income taxes are provided to recognize the effect of temporary differences between tax and financial reporting. Deferred income tax assets and liabilities consist of the following: Schedule of Deferred Tax Assets and Liabilities
|  | 2024 |  |  | 2023 |
|  | Fiscal Year |
|  | 2024 |  |  | 2023 |
Deferred tax assets: |  |  |  |  |  |  |  |
Federal net operating loss carryforwards |  | $ | 47,844,000 |  |  | $ | 49,213,000 |
State net operating loss carryforwards |  |  | 8,376,000 |  |  |  | 7,881,000 |
Foreign net operating loss carryforwards |  |  | 1,357,000 |  |  |  | 1,183,000 |
Litigation accrual |  |  | 6,621,000 |  |  |  | — |
Equity awards |  |  | 321,000 |  |  |  | 37,000 |
Tax credits |  |  | 9,751,000 |  |  |  | 9,849,000 |
R&D expense amortization |  |  | 2,860,000 |  |  |  | 2,316,000 |
Property, plant and equipment |  |  | 630,000 |  |  |  | 598,000 |
Unrealized losses on investments |  |  | 2,376,000 |  |  |  | 2,292,000 |
Inventory reserves |  |  | 1,498,000 |  |  |  | 1,212,000 |
Accrued legal |  |  | 1,571,000 |  |  |  | 56,000 |
Other |  |  | 588,000 |  |  |  | 1,531,000 |
Deferred tax assets |  |  | 83,793,000 |  |  |  | 76,168,000 |
Valuation allowance |  |  | (83,793,000 | ) |  |  | (76,168,000 | )
Net deferred tax assets |  |  | — |  |  |  | — |
Deferred tax liability: |  |  |  |  |  |  |  |
Foreign withholding liability |  |  | (414,000 | ) |  |  | (471,000 | )
Net deferred tax liability |  | $ | (414,000 | ) |  | $ | (471,000 | )
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The valuation allowance was approximately $83.8 million and $76.2 million at December 28, 2024 and December 30, 2023, respectively, primarily driven by U.S. net operating loss carryforwards (“NOLs”) and tax credits. Based on the available evidence it is more likely than not the deferred tax assets will not be realized. As of December 28, 2024, the Company has available for tax purposes NOLs of $116.3 million expiring in 2025 through 2037 and $111.5 million that have an unlimited carryover period. The Company has recognized a full valuation allowance on its net deferred tax assets as the Company has concluded that such assets are not more likely than not to be realized. The 2017 Tax Act imposes a mandatory transition tax on accumulated foreign earnings and eliminates U.S. taxes on foreign subsidiary distributions. As a result, earnings in foreign jurisdictions are available for distribution to the U.S. without incremental U.S. income taxes. The Company intends to permanently reinvest undistributed earnings. As of December 28, 2024, foreign earnings have been retained by the Company’s foreign subsidiaries for indefinite reinvestment. Upon repatriation of those earnings, in the form of dividends or otherwise, the Company could be subject to withholding taxes payable to the various foreign countries. Determination of the amount of unrecognized deferred income tax liability related to these outside basis differences is not practicable. Under the provisions of Section 382, certain substantial changes in Kopin’s ownership may limit in the future the amount of net operating loss carryforwards that could be used annually to offset future taxable income and income tax liability. The Company’s income tax returns have not been examined by the Internal Revenue Service and are subject to examination for all years since 2002. State income tax returns are generally subject to examination for a period of three to five years after filing of the respective return. The state impact of any federal changes remains subject to examination by various states for a period of up to one year after formal notification to the states. The Company is not currently under examination in these jurisdictions. International jurisdictions have statutes of limitations generally ranging from three to twenty years after filing of the respective return. Years still open to examination by tax authorities in major jurisdictions include Korea (2011 onward), Japan (2011 onward), Hong Kong (2013 onward) and the United Kingdom (2016 onward). The Company is not currently under examination in these jurisdictions.

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