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INCOME TAXES | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
INCOME TAXES | INCOME TAXES The components of the income tax provision (benefit) from continuing operations were as follows:
($ in millions) | 2024 |  | 2023
Current |  |  |
Federal | $ | (0.1) |  |  | $ | 0.4 |
State | 0.3 |  |  | 0.4 |
Total current income tax expense | 0.2 |  |  | 0.8 |
Deferred |  |  |
Federal | (0.2) |  |  | 49.5 |
State | (0.2) |  |  | 9.0 |
Total deferred income tax provision (benefit) | (0.4) |  |  | 58.5 |
Income tax provision (benefit) | $ | (0.2) |  |  | $ | 59.3 |
A reconciliation of the statutory U.S. Federal income tax rate of 21% to our effective income tax rate follows:
| 2024 |  | 2023
U.S. Federal statutory rate | 21.0% |  | 21.0%
Change in valuation allowance | (20.1)% |  | (52.7)%
Stock-based compensation | (0.7)% |  | (0.9)%
State and local, net of federal benefit | (0.1)% |  | (4.7)%
Executive compensation | —% |  | (0.3)%
Other | 0.3% |  | (0.7)%
Effective tax rate | 0.4% |  | (38.3)%
Deferred income taxes reflect the net tax effect of temporary differences between amounts recorded for financial reporting and amounts used for tax purposes. The major components of deferred tax assets and liabilities are as follows:
($ in millions) | 2024 |  | 2023
Deferred tax assets: |  |  |
Net operating loss carryforward | $ | 33.8 |  |  | $ | 26.5 |
Business interest carryforward | 31.5 |  |  | 21.5 |
Goodwill and intangible assets | 46.9 |  |  | 43.8 |
Lease liabilities | 47.4 |  |  | 49.4 |
Inventory reserve | — |  |  | 2.6 |
Transaction costs | 1.1 |  |  | 1.2 |
Stock-based compensation | 0.4 |  |  | 0.3 |
Other | 0.6 |  |  | 0.5 |
Total gross deferred tax assets | 161.7 |  |  | 145.8 |
Valuation allowance | (113.0) |  |  | (93.6) |
Deferred tax assets, net | 48.7 |  |  | 52.2 |
Deferred tax liabilities: |  |  |
ROU assets | 36.5 |  |  | 39.0 |
Property and equipment | 12.2 |  |  | 12.5 |
Debt issuance costs amortization | — |  |  | 0.7 |
Other | — |  |  | 0.4 |
Deferred tax liabilities | 48.7 |  |  | 52.6 |
Net deferred tax asset (liability) | $ | — |  |  | $ | (0.4) |
The Company has evaluated the positive and negative evidence bearing upon its ability to realize the deferred tax assets. As of December 31, 2024 and 2023, management has evaluated the realizability of the Company’s deferred tax assets and recorded a valuation allowance against the Company’s federal and state deferred tax assets, as it is more likely than not that the deferred tax assets will not be realized based on the evidence evaluated.
($ in millions) | 2024 |  | 2023
Valuation allowance as of beginning of the year | $ | 93.6 |  |  | $ | 0.7 |
Increases recorded to income tax provision | 19.4 |  |  | 92.9 |
Valuation allowance as of end of year | $ | 113.0 |  |  | $ | 93.6 |
As of December 31, 2024 and 2023, the Company has federal net operating loss carryforwards of $140.2 million and $112.4 million, all of which were generated in years beginning in 2018 and can be carried forward indefinitely. As of December 31, 2024 and 2023, the Company had state net operating loss carryforwards of $100.2 million and $64.8 million, a portion of which begin to expire in 2029. As a result of various ownership changes, the Company’s federal and state net operating losses are subject to limitations under Internal Revenue Code Section 382. We do not have unrecognized tax benefits related to uncertain tax positions. Tax years 2019 through 2023 remain open to examination by the U.S. federal and state taxing jurisdictions, as carryforward attributes generated in prior years may still be adjusted upon examination by the Internal Revenue Service or state tax authorities if they have been or will be used in a future period. The Company files income tax returns in the U.S. federal and various state jurisdictions. There are currently no federal or state audits in progress.

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