INCOME TAXES |
9 Months Ended |
|---|---|
Sep. 30, 2025 | |
| INCOME TAXES | |
| INCOME TAXES |
12.Income Taxes The quarterly provision for or benefit from income taxes is based on applying the estimated annual effective tax rate to the year-to-date pre-tax income, adjusted for any discrete items. We update our estimate of our annual effective tax rate at the end of each quarterly period. The benefit from or provision for income taxes for the three and nine months ended September 30, 2025 was primarily related to estimated state income taxes. We do not expect to owe federal income tax due to sufficient net operating loss carryforwards, as well as significant research and development credit carryforwards. For the three and nine months ended September 30, 2024, we did not record a provision for income taxes based on the forecasted pre-tax book loss. In July 2025, the One Big Beautiful Bill Act (OBBBA), formally titled “An Act to provide for reconciliation pursuant to title II of H. Con. Res. 14.” was signed into law. The OBBBA introduces a wide range of provisions affecting business entities, including the establishment of certain permanent business tax measures. Key provisions include a permanent and immediate deduction for domestic research and development expenditures, the restoration and permanent extension of 100% expensing for qualified equipment purchases, and restores the ability to add back depreciation and amortization expense when determining the limitation on interest deductions. In accordance with ASC 740, Income Taxes, the effects of changes in tax laws are recognized in the period of enactment. Accordingly, we accounted for the estimated impact of the OBBBA in our current period tax provision. The enactment of the OBBBA did not have a material impact on our condensed financial statements for the three and nine months ended September 30, 2025. As of September 30, 2025, we continue to record a full valuation allowance on our deferred tax assets. The realization of deferred tax assets is dependent upon demonstrating sufficient positive evidence to conclude that it is more-likely-than-not that our deferred tax assets will be realized. This assessment requires significant judgment. In making this determination, all available evidence, both positive and negative, is considered to determine whether, based on the weight of that evidence, a valuation allowance for deferred tax assets is needed. If sufficient positive evidence becomes available to allow us to reach a conclusion that a portion of the valuation allowance against the deferred tax assets may be reversed, the reversal would result in an income tax benefit for the quarterly and annual fiscal period in which we determine to release such valuation allowance. |