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Income Taxes
 9 Months Ended
Sep. 30, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Funko, Inc. is taxed as a corporation and pays corporate federal, state and local taxes on income allocated to it from FAH, LLC based upon Funko, Inc.’s economic interest held in FAH, LLC. FAH, LLC is treated as a pass-through partnership for income tax reporting purposes. FAH, LLC’s members, including the Company, are liable for federal, state and local income taxes based on their share of FAH, LLC’s pass-through taxable income.
The Company recorded income tax expense of $3.1 million and $130.9 million for the three and nine months ended September 30, 2023, respectively, and $2.3 million of income tax expense and $2.9 million of income tax benefit for the three and nine months ended September 30, 2022, respectively. The Company’s effective tax rate for the nine months ended September 30, 2023 was (584.9)%. The Company’s effective tax rate is less than the statutory rate of 21% primarily due to the establishment of the valuation allowance as of June 30, 2023.
The Company is party to the Tax Receivable Agreement that provides for the TRA Payment by the Company to the TRA Parties under certain circumstances. See Note 5, Liabilities under Tax Receivable Agreement.