BIODESIX INC Income Taxes Disclosure

Note 14 - Income Taxes

Since inception, the Company has incurred net taxable losses, and accordingly, no current provision for income taxes has been recorded. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts for income tax purposes. Significant components of our deferred income tax assets and liabilities are as follows (in thousands):

On July 4, 2025, the One Big Beautiful Bill Act (the OBBBA) was enacted into law. The OBBBA includes several significant tax law changes applicable to the Company.

Key provisions include:

As of December 31, 2025, the Company maintains a full valuation allowance against its net deferred tax assets and liabilities. Accordingly, the enactment of the OBBBA did not have a material impact to the Company.

Management regularly assesses the ability to realize deferred tax assets recorded based upon the weight of available evidence, including such factors as recent earnings history and expected future taxable income on a jurisdiction by jurisdiction basis. In the event that the Company changes its determination as to the amount of realizable deferred tax assets, the Company will adjust its valuation allowance with a corresponding impact to the provision for income taxes in the period in which such determination is made. The Company’s management believes that, based on a number of factors, it is more likely than not, that all or some portion of the deferred tax assets will not be realized. Accordingly, for the years ended December 31, 2025 and 2024, the Company has provided a valuation allowance against the Company’s U.S. net deferred tax assets. The net change in the valuation allowance for the year ended December 31, 2025 and 2024, was an increase of $7.5 million and $6.0 million, respectively.

As of December 31, 2025, the Company had net operating loss carryforwards for federal income tax purposes of approximately $358.9 million which will begin to expire in 2026, with $182.0 million lasting indefinitely. As of December 31, 2025, the Company had net operating loss carryforwards for state income tax purposes of approximately $199.4 million, which began to expire on December 31, 2025. The Internal Revenue Code of 1986, as amended, imposes restrictions on the utilization of net operating losses in the event of an “ownership change” of a corporation. Accordingly, a company’s ability to use net operating losses may be limited as prescribed under Internal Revenue Code Section 382 (IRC Section 382). Events which may cause limitations in the amount of the net operating losses that the Company may use in any one year include, but are not limited to, a cumulative ownership change of more than 50% over a three-year period. Utilization of the federal and state net operating losses may be subject to substantial annual limitation due to the ownership change limitations provided by the IRC Section 382 and similar state provisions.

As of December 31, 2025, the Company had federal and state research credit carryforwards of approximately $0.7 million and zero, respectively. The federal research credit carryforwards will begin to expire in 2027.

During 2025, the Company determined that it has uncertain tax positions related to its U.S. research and development credits. The Company's policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. As of December 31, 2025 and 2024, there was no accrued interest and penalties related to uncertain tax positions. As of December 31, 2025, no unrecognized tax benefits, if recognized, would have an impact on the Company's effective tax rate. The Company does not believe it is reasonably possible that its unrecognized tax benefits will significantly change in the next twelve months. A reconciliation of beginning and ending balances for unrecognized tax benefits is as follows (in thousands):

The Company monitors proposed and issued tax law, regulations, and cases to determine the potential impact of uncertain income tax positions. As of December 31, 2025, the Company had not identified any potential subsequent events that would have a material impact on unrecognized income tax benefits within the next twelve months.

The Company files income tax returns in the U.S. federal and various state jurisdictions with varying statutes of limitations. In both 2025 and 2024, state and local income taxes in California, Florida, Illinois, New Jersey, and New York comprise the majority of the ‘State and local income taxes, net of federal benefit’ category, although no income taxes were paid to any jurisdiction. The Company’s federal and state returns for all years will remain open to examination by federal and state tax authorities for three and four years, respectively, from the date of utilization of any net operating loss carryforwards.