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Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The components of the Company’s provision for income taxes for the years ended December 31, 2024 and 2023 consists of the following (in thousands):
December 31,
20242023
Current:
Federal$— $— 
United States— — 
Foreign— — 
          Total Current— — 
Deferred
Federal(11,236)7,743 
State1,192 3,116 
Foreign— — 
Change in valuation allowance
10,044 (10,859)
          Total Deferred— — 
                   Total tax provision$— $— 
The reconciliations between the federal statutory income tax rate and the Company's effective income tax rate were as follows:
Year Ended December 31,
20242023
Statutory federal income tax rate
21.0 %21.0 %
State tax, net of federal benefits(2.4)%6.2 %
Permanent differences(3.5)%(0.3)%
Federal research and development credits3.6 %3.1 %
State research and development credits
0.6 %0.8 %
Other differences
0.1 %0.1 %
Change in valuation allowance(19.4)%(30.9)%
Effective income tax rate
0.0 %0.0 %
The principal components of the Company's net deferred tax asset at December 31, 2024 and 2023 were as follows (in thousands):
December 31,
20242023
Deferred tax assets (liabilities):
Net operating loss carryforwards
$64,646 $60,696 
Research and development tax credit carryovers
15,117 12,940 
Capitalized research and development
17,585 13,686 
Lease liability
1,548 1,897 
Other
2,704 2,732 
ROU asset
(1,470)(1,800)
Property and equipment(13)(33)
Total deferred tax assets
100,117 90,118 
Less: Deferred tax asset valuation allowance(100,117)(90,118)
Net deferred tax asset
$— $— 

Net operating losses (“NOL”) generated before December 31, 2017 can be carried forward 20 years under the Internal Revenue Code (“IRC”). Use of NOLs arising in tax years ended after December 31, 2017 are limited to 80% of taxable income in any one tax year, and are carried forward indefinitely. The Company has no income tax expense due to operating losses incurred for the years ended December 31, 2024 and 2023. The Company has provided a valuation allowance for the full amount of the net deferred tax assets as, based on all available evidence, it is considered more likely than not that all the recorded deferred tax assets will not be realized in a future period. The increase in the net deferred tax assets and valuation allowance is primarily due to increases in federal and state NOLs, federal and state research credits, and capitalized research expenditures. At December 31, 2024, Elicio has federal NOLs of $261.8 million, of which $19.1 million was generated before the tax year ended December 31, 2018, and state NOLs of $145.2 million. If not utilized, certain NOLs for federal and state tax purposes will start to expire beginning in 2032. At December 31, 2024, Elicio has $12.9 million and $2.6 million of federal and state research and development credit carryforwards, respectively, that start to expire in 2027.
As the Company has not yet achieved profitable operations, management believes the tax benefits as of December 31, 2024 did not satisfy the realization criteria set forth in ASC Topic 740, Income Taxes and, therefore, has recorded a full valuation allowance for the entire deferred tax asset. The valuation allowance increased in 2024 by $10.0 million due to the increase in the deferred tax assets by the same amount, primarily due to NOL carryforwards. The Company’s effective income tax rate differed from the federal statutory rate primarily due to state taxes and the Company’s full valuation allowance, the latter of which reduced the Company’s effective federal income tax rate to zero.
Ownership changes, as defined in the IRC, may limit the amount of NOL carryforwards that can be utilized annually to offset future taxable income pursuant to IRC Section 382 or similar provisions. Subsequent ownership
changes could further affect the limitation in future years. The Company has not completed a study to assess whether a change of control has occurred or whether there have been multiple changes of control since the Company’s formation due to the significant complexity and cost associated with such study and because there could be additional changes in control in the future. As a result, the Company is not able to estimate the effect of the change in control, if any, on the Company’s ability to utilize NOL and research and development credit carryforwards in the future.
The Company files tax returns in the United States, Australia, California, Connecticut, Florida, Massachusetts, Michigan, Missouri, New Hampshire, New Jersey, North Carolina, Pennsylvania, and Tennessee. All tax years from 2021 to 2024 remain open to examination by the major taxing jurisdictions to which the Company is subject, as carryforward attributes generated in years past may still be adjusted upon examination by the Internal Revenue Service (“IRS”) or other authorities if they have or will be used in a future period. To its knowledge, the Company is not currently under examination by the IRS or any other jurisdictions for any tax years.
As of December 31, 2024, the Company had $4.1 million of uncertain tax positions related to prior research tax credits that may not be substantiated upon audit. The Company does not anticipate that uncertain tax positions will decrease within the next 12 months. The Company has elected to recognize interest and penalties related to income tax matters as a component of income tax expense, of which no interest or penalties were recorded for the years ended December 31, 2024 and 2023.