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Income Taxes
 3 Months Ended
Mar. 31, 2025
Income Taxes [Abstract]  
Income Taxes

8. Income Taxes

 

The Company’s provision for income taxes consists of federal, foreign, and state taxes, as applicable, in amounts necessary to align the Company’s year-to-date tax provision with the effective rate that it expects to achieve for the full year. Each quarter the Company updates its estimate of the annual effective tax rate and records cumulative adjustments as necessary.

 

For the three months ended March 31, 2025, the Company recorded an income tax benefit of $2,060,065, which included a discrete tax benefit of $1,665,189 primarily related to a partial release of its valuation allowance as the Acquisition created a source of future taxable income allowing for the recognition of certain deferred tax assets due to the release of a portion of its valuation allowance. The effective tax rate for the three months ended March 31, 2025 was 164.7% which differs from the statutory rate of 21% primarily related to changes in the Company’s valuation allowance due to the business combination accounting. The Company continues to conclude that its U.S. deferred tax assets are not realizable on a more-likely-than-not basis and maintains a full valuation allowance against such deferred tax assets.

 

For the three months ended March 31, 2024, the Company recorded an income tax benefit of $598,710. The effective tax rate for the three months ended March 31, 2024 was 19.3% which differs from the statutory rate of 21% primarily relate to changes in the Company’s valuation allowance, difference in foreign tax rates from the U.S. statutory rate of 21% and state and local taxes. The Company continues to conclude that its U.S. deferred tax assets are not realizable on a more-likely-than-not basis and maintains a full valuation allowance against such deferred tax assets.