XML 40 R23.htm IDEA: XBRL DOCUMENT
v3.24.0.1

INCOME TAX | 12 Months Ended
--- | ---
Dec. 31, 2023
Income Tax Disclosure [Abstract] |
INCOME TAX | INCOME TAX: The loss before income taxes and the related tax (benefit) expense is as follows:
| Year ended December 31,
(in thousands) | 2023 |  | 2022
Income (loss) before income taxes: |  |  |
Domestic | $ | (28,459) |  |  | $ | (23,472) |
Foreign | 7 |  |  | 279 |
Total loss before taxes | $ | (28,452) |  |  | $ | (23,193) |
Current taxes: |  |  |
Federal | $ | (123) |  |  | $ | — |
State | 2 |  |  | 13 |
Foreign | 121 |  |  | — |
Total current taxes | $ | — |  |  | $ | 13 |
A reconciliation of income taxes at the U.S. federal statutory rate to the provision for income taxes is as follows:
|  | Year ended December 31,
|  | 2023 |  | 2022
Federal income tax provision at statutory rate |  | 21.00 | % |  | 21.00 | %
State income tax provision, net of federal benefit |  | (0.01) | % |  | (0.04) | %
Permanent differences |  | (0.57) | % |  | (1.52) | %
Change in valuation allowances |  | (20.42) | % |  | (19.49) | %
Other |  | — | % |  | — | %
Effective income tax rate |  | — | % |  | (0.05) | %
The income tax expense for the years ended December 31, 2023 and 2022 differed from the amounts computed by applying the U.S. federal income tax rate of 21% to loss before tax expense as a result of nondeductible expenses, changes in state effective tax rates, foreign taxes, tax credits generated, true up of net operating loss carryforwards, and increase in the Company’s valuation allowance. The Company applies the elements of ASC 740-10 regarding accounting for uncertainty in income taxes. This clarifies the accounting for uncertainty in income taxes recognized in financial statements and required impact of a tax position to be recognized in the financial statements if that position is more likely than not of being sustained by the taxing authority. Included in Other Liabilities on the consolidated balance sheets are the total amount of unrecognized tax benefits of approximately $2.5 million and $2.9 million as of December 31, 2023 and 2022, respectively, net of the federal benefit, which is offset by a valuation allowance. The Company’s policy is to recognize interest and penalties related to tax matters within the income tax provision. Tax years beginning in 2019 are generally subject to examination by taxing authorities, although net operating losses from all years are subject to examinations and adjustments for at least three years following the year in which the attributes are used. The significant components of the Company's deferred tax assets and liabilities are as follows:
| December 31,
(in thousands) | 2023 |  | 2022
Deferred tax assets: |  |  |
Net operating loss carryforwards | $ | 72,508 |  |  | $ | 72,903 |
Tax credit carryforwards | 6,851 |  |  | 7,794 |
Section 174 expenses | 7,775 |  |  | 3,529 |
Share-based compensation | 1,988 |  |  | 2,061 |
Accrued expenses and other | 651 |  |  | 586 |
Total gross deferred tax assets | 89,773 |  |  | 86,873 |
Less - valuation allowance | (89,773) |  |  | (86,873) |
Total deferred tax assets, net of valuation allowance | $ | — |  |  | $ | — |
Deferred tax liabilities: |  |  |
Other | — |  |  | — |
Right of use assets | — |  |  | — |
Total gross deferred tax liabilities | — |  |  | — |
Net deferred tax assets | $ | — |  |  | $ | — |
Realization of deferred tax assets is contingent upon sufficient future taxable income during the period that deductible temporary differences and carry forward losses are expected to be available to reduce taxable income. As the achievement of required future taxable income is not likely, the Company recorded a full valuation allowance. At December 31, 2023 and 2022, the Company recorded a valuation allowance against its net deferred tax assets of $89.8 million and $86.9 million, respectively. The change in the valuation allowance during the years ended December 31, 2023 and 2022 was an increase of $2.9 million and $1.3 million, resp ectively. A valuation allowance has been recorded since, in the judgment of management, these assets are not more likely than not to be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences and carryforwards become deductible or are utilized. As of December 31, 2023, the Company had federal and state net operating loss carryforwards of $331.1 million and $41.7 million, respectively, of which $44.3 million will begin to expire in 2031 for federal and $21.3 million will begin to expire in 2040 for state purposes. As of December 31, 2023, the Company had federal research and development tax credit carryforwards of $6.9 million which will begin to expire in 2031. The Company has no state research and development tax credit carryforwards. As a result of U.S. tax reform legislation, federal net operating losses generated beginning in 2018 and subsequent years carryforward indefinitely, however, the Company has federal net operating losses that pre-date U.S. tax reform legislation which begin to expire in 2031 and federal credit carryforwards that begin to expire in 2031. State net operating loss carryforwards begin to expire in 2031, and the state credit carryforwards began to expire in 2031. Sections 382 and 383 of the Internal Revenue Code of 1986 subject the future utilization of net operating losses and certain other tax attributes, such as research and development tax credits, to an annual limitation in the event of certain ownership changes, as defined. The Company has not completed a 382 study through December 31, 2023, however, it may have experienced ownership changes in the past, including in connection with the Merger. In addition, the Private Placement likely resulted in an ownership change for purposes of Section 382 and therefore t he Company may be materially limited in the amount of NOL and R&D tax credit available for utilization in the future. The Company generated research and development tax credits but has not conducted a study to document the qualified activities. This study may result in an adjustment to the Company’s research and development credit carryforwards; however, until a study is completed and any adjustment is known, a partial reserve has been presented as an uncertain tax position which is offset against the gross research and development deferred tax asset. A full valuation allowance has been provided against the Company’s research and development credits and, if an adjustment is required, this would be offset by an adjustment to the deferred tax asset established for the research and development credit carryforwards and the valuation allowance. Uncertain tax positions: ASC No. 740, Income Taxes, requires significant judgment in determining what constitutes an individual tax position as well as assessing the outcome of each tax position. Changes in judgment as to recognition or measurement of tax positions can materially affect the estimate of the effective tax rate and consequently, affect the operating results of the Company. The following table summarizes the activity of the Company's unrecognized tax benefits (in thousands):
Balance at January 1, 2022 | $ | 2,799 |
Additions for prior year positions | — |
Additions for current year positions | 55 |
Reductions related to expiration of statute of limitations | — |
Balance at December 31, 2022 | $ | 2,854 |
Additions for prior year positions | 19 |
Additions for current year positions | 105 |
Reductions related to expiration of statute of limitations | (520) |
Balance at December 31, 2023 | $ | 2,458 |

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration