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Note 16 - Income Taxes
 9 Months Ended
Sep. 30, 2025
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

16. Income Taxes

 

The provision for income taxes reflects current taxes and deferred taxes. The effective tax rate for each of the nine months ended September 30, 2025 and 2024 was 0%.

 

The valuation allowance against net deferred tax assets as of September 30, 2025, was $112,750, an increase of $8,389 from $104,361 as of December 31, 2024. The Company continues to provide for a valuation allowance to offset its net deferred tax assets until such time it is more likely than not the tax assets or portions thereof will be realized.

 

Excess tax deficiencies of $948 and $102 were recognized in the provision for income taxes for the three months ended September 30, 2025 and 2024, respectively, which were offset by $948 and $102 of valuation allowance, respectively.

 

An excess tax deficiency of $1,827 and an excess tax benefit of $1,410 were recognized in the provision for income taxes for the nine months ended September 30, 2025 and 2024, respectively, which were offset by $1,827 and $1,410 of valuation allowance, respectively.

 

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”), which includes a broad range of tax reform provisions, was signed into law in the United States, which includes a new Internal Revenue Code ("IRC") Section 174A. Under Section 174A, commencing with tax years beginning after December 31, 2024, domestic research or experimental expenditures may be deducted in the current period rather than capitalized and amortized over multiple years, as previously required under IRC Section 174. As a result of this legislation, the Company intends to deduct its domestic Section 174A expenditures beginning in its 2025 taxable year. The Company does not expect the OBBBA to have a material impact on its effective tax rate, financial condition, or results of operations in 2025.