BIOVIE INC. Income Taxes Disclosure
| 12. | Income Taxes |
Significant components of the Company’s deferred tax assets (liabilities) are as follows:
| June 30, 2025 | June 30, 2024 | |||||||
| Deferred tax assets (liabilities): | ||||||||
| Tax loss carryforward | $ | 58,323,950 | $ | 51,429,074 | ||||
| Intangible assets | (49,935 | ) | (114,161 | ) | ||||
| Stock based compensation | 6,531,784 | 5,860,272 | ||||||
| R&D capitalized | 10,134,322 | 12,467,969 | ||||||
| Valuation Allowance | (74,940,121 | ) | (69,643,154 | ) | ||||
| Net deferred tax assets | $ | $ | ||||||
At June 30, 2025 and 2024, the Company has recorded a full valuation against its net deferred tax assets of approximately $74.9 million and $69.6 million, respectively, since in the judgement of management, these assets are not more than likely to be realized. The increase in the valuation allowance during the year ended June 30, 2025 was approximately $5.3 million.
At June 30, 2025, the Company had a Net Operating Loss (“NOL”) carryforward of approximately $208 million. NOL’s generated prior to 2018 have expiration dates ranging from 2032 to 2037. Utilization of the Company’s historical NOL are subject to limitations under Internal Revenue Code Section 382 as a result of multiple ownership changes through the Company’s capital raises.
The Company has no current tax expense due to its net losses and a full valuation allowance.
Reconciliation of the differences between income tax benefit computed at the federal and state statutory tax rates and the provision for income tax benefit for the years ended June 30, 2025 and 2024 is as follows:
| 2025 | 2024 | |||||||
| Income tax expense at federal statutory rate | 21 | % | 21 | % | ||||
| State taxes, net of federal benefit | 7 | % | 7 | % | ||||
| Change in valuation allowance | (28 | %) | (28 | %) | ||||
| Effective tax rate | ||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Aug 15, 2025 | Showing above |
| 2024 | Sep 30, 2024 | |
| 2023 | Aug 16, 2023 | |
| 2022 | Sep 27, 2022 | |
| 2021 | Aug 30, 2021 | |
| 2020 | Aug 6, 2020 | |
| 2019 | Sep 27, 2019 | |
| 2018 | Oct 5, 2018 | |
| 2017 | Aug 24, 2017 | |
| 2016 | Sep 28, 2016 | |
| 2015 | Oct 1, 2015 | |
About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.