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Goodwill and Intangible Assets | 9 Months Ended
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Sep. 30, 2025
Goodwill and Intangible Assets [Abstract] |
Goodwill and Intangible Assets | NOTE 5 –GOODWILL AND INTANGIBLE ASSETS The Company reassesses the value of our reporting units and related goodwill balances annually on October 1 and at other times if events have occurred or circumstances exist that indicate the carrying amount of goodwill may not be recoverable. On July 4, 2025, the President signed H.R. 1, the “One Big Beautiful Bill Act,” or “OBBBA”, into law, which accelerates the phase-outs and terminations of various eligible tax credits enacted as part of the Inflation Reduction Act and places restrictions on continued receipt of tax credits by specified foreign entities and foreign influenced entities. The OBBBA terminates several consumer-facing tax credits, including the Residential Clean Energy Credit (Section 25D) and the Energy Efficient Home Improvement Credit (Section 25C), effective at the end of 2025. The Section 25D credit previously allowed homeowners to claim a 30% credit for installing rooftop solar panels and related equipment. The OBBBA also has an accelerated phaseout of the Clean Electricity Investment Tax Credit (Section 48E) and the Clean Electricity Production Tax Credit (45Y). In this accelerated phase out, projects must begin construction by July 4, 2026, or be placed in service by December 31, 2027, to qualify for these credits. The Company performed a quantitative assessment related to the recoverability of our goodwill for our two reporting units as a result of the material decline in our forecasted revenues and operating results. The Company estimated the fair value of the reporting units using an equally weighted combination of an income approach and market approach. Under the income approach, the Company discounted the estimated future cash flows of each reporting unit using a rate of return commensurate with the reporting unit’s risk. Under the market approach, the Company utilized the Guideline Public Company Method based on market revenue multiples of comparable publicly traded companies. The Company concluded that the fair values of the SUNation NY and HEC reporting units exceeded its carrying value as of September 30, 2025 and no impairment charge was necessary. As a result of the implications of the OBBBA as noted above, the Company performed an impairment test on the tradenames and trademarks intangible assets associated with both the HEC and SUNation reporting units as of September 30, 2025. The Company calculated the undiscounted cash flows associated with the asset groups and compared that to the carrying value of the asset groups. As the asset groups did not meet the recoverability test, the Company calculated the fair value of the tradenames and trademarks intangible assets and compared it to the carrying value of the intangible assets, noting that the fair value was less than the carrying value. However, since the carrying value of the asset groups was less than the fair value of the asset groups, as calculated within the goodwill impairment analysis, no impairment charge was realized. The Company’s identifiable intangible assets with finite lives are being amortized over their estimated useful lives and were as follows:
|  |  |  | September 30, 2025
| Estimated Useful Life |  | Gross Carrying Amount |  | Accumulated Amortization |  | Impairment loss | Net
Tradenames & trademarks | 8 years |  | $ | 17,900,000 |  | $ | (7,357,292) | $ | — | $ | 10,542,708
Developed technology | 4 years |  |  | 2,400,000 |  |  | (1,650,000) |  | (750,000) |  | —
|  |  | $ | 20,300,000 |  | $ | (9,007,292) | $ | (750,000) | $ | 10,542,708
|  |  |  | December 31, 2024
| Estimated Useful Life |  | Gross Carrying Amount |  | Accumulated Amortization |  | Impairment loss | Net
Tradenames & trademarks | 8 years |  | $ | 17,900,000 |  | $ | (5,679,167) | $ | — | $ | 12,220,833
Developed technology | 4 years |  |  | 2,400,000 |  |  | (1,650,000) |  | (750,000) |  | —
|  |  | $ | 20,300,000 |  | $ | (7,329,167) | $ | (750,000) | $ | 12,220,833
Amortization expense on these identifiable intangible assets was $559,375 and $709,375 during the three months ended September 30, 2025 and 2024, respectively and $1,678,125 and $2,128,125 for the nine months ended September 30, 2025 and 2024, respectively. The estimated future amortization expense for identifiable intangible assets during the next fiscal years is as follows:
Quarter Ending and Year Ending December 31: |  |  |
Q4 2025 |  | $ | 559,375
2026 |  |  | 2,237,500
2027 |  |  | 2,237,500
2028 |  |  | 2,237,500
2029 |  |  | 2,237,500
Thereafter |  |  | 1,033,333
Total |  | $ | 10,542,708

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- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 30 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-30/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-20/tableOfContent + Details
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