IMMUNIC, INC.IMUX
IMMUNIC, INC. Income Taxes Disclosure
Income Taxes
Net loss before income tax was subject to tax in the following jurisdictions for the following periods (in thousands):
| Years Ended December 31, | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| United States | $ | (19,986) | $ | (21,382) | ||||||||||
| Germany | (77,157) | (78,914) | ||||||||||||
| Foreign | (29) | (211) | ||||||||||||
| $ | (97,172) | $ | (100,507) | |||||||||||
A reconciliation of the provision for income taxes to the amount computed by applying the 21% statutory U.S federal income tax rate to net loss before income taxes after the adoption of ASU 2023-09 as follows:
| Years Ended December 31, | ||||||||
| 2025 | ||||||||
| Federal statutory rate | $ | (20,406) | 21.0 | % | ||||
| State tax effect | — | 0.0 | % | |||||
| Foreign tax effect | ||||||||
| Germany | ||||||||
| Statutory tax rate differential | (2,758) | 2.8 | % | |||||
| Change in valuation allowance | (4,230) | 4.4 | % | |||||
| Rate changes | 24,851 | (25.6) | % | |||||
| Other | (1,660) | 1.7 | % | |||||
| Other foreign jurisdictions | 6 | 0.0 | % | |||||
| Nontaxable or non-deductible items | ||||||||
| Stock compensation | 1,392 | (1.4) | % | |||||
| Other | 196 | (0.2) | % | |||||
| Change in valuation allowance | 2,609 | (2.7) | % | |||||
| Effective tax rate | $ | — | 0.0 | % | ||||
As previously disclosed for the years ended December 31, 2024 prior to the adoption of ASU 2023-09, the following is a reconciliation of the difference between the effective income tax rate and federal statutory rate:
| December 31, | |||||
| 2024 | |||||
| Federal statutory rate | 21.0 | % | |||
| Foreign rate differential | 2.8 | % | |||
| Stock options | (1.4) | % | |||
| Deferred tax true-up | (2.5) | % | |||
| Stock and warrant issuance cost | (1.4) | % | |||
| Other | (0.9) | % | |||
| Change in valuation allowance | (17.6) | % | |||
| Effective tax rate | 0.0 | % | |||
Deferred income taxes result from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements that will result in taxable or deductible amounts in future years. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in years in which those temporary differences are expected to be recovered or settled. As tax laws and rates change, deferred tax assets and liabilities are adjusted through income tax expense. There is no current or deferred income tax expense in the years ended December 31, 2025, and 2024, respectively.
Significant components of the Company's net deferred tax assets are shown below. A valuation allowance has been established as realization of such net deferred tax assets has not met the more likely-than-not threshold requirement. If the Company's judgment changes and it is determined that the Company will be able to realize these net deferred tax assets, the tax benefits relating to any reversal of the valuation allowance on the net deferred tax assets will be accounted for as a reduction to income tax expense.
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (in thousands) | |||||||||||
| Deferred tax assets: | |||||||||||
| Net operating loss carryforwards | $ | 24,483 | $ | 22,192 | |||||||
| Stock-based compensation | 2,453 | 2,198 | |||||||||
| Intangible assets | 2,087 | 2,630 | |||||||||
| Foreign net operating loss carryforwards | 90,643 | 90,020 | |||||||||
| Other, net | 207 | 38 | |||||||||
| Total deferred tax assets | 119,873 | 117,078 | |||||||||
| Deferred tax liabilities: | |||||||||||
| Total deferred tax liability | — | — | |||||||||
| Net deferred tax assets | 119,873 | 117,078 | |||||||||
| Less valuation allowance | (119,873) | (117,078) | |||||||||
| $ | — | $ | — | ||||||||
The Company has incurred net operating losses each year since inception due to its history as a development stage company with no realized revenues from its planned principal operations. These cumulative operating losses provide significant negative evidence in the determination of whether or not the Company will be able to realize deferred tax assets such as net operating losses and other favorable temporary differences. There can be no assurance that it will ever generate taxable income. As a result, the Company has maintained a full valuation allowance against the entire balance of its net deferred tax assets since the date of inception. The valuation allowance has increased by $2.8 million and $18.0 million for the years ended December 31, 2025, and 2024, respectively.
As of December 31, 2025, Immunic had available NOLs of approximately $460.9 million in Germany and $6.7 million in Australia, respectively. These NOLs do not expire.
The U.S. federal NOL carryforwards of $15.6 million were generated prior to 2018 and expire over 20 years beginning in 2023. The $100.4 million of post 2017 federal NOL carryforwards does not expire. Sections 382 of the Internal Revenue Code of 1986 subject the future utilization of net operating losses, to an annual limitation in the event of certain ownership changes, as defined. The Company may have undergone ownership changes and therefore may be limited in the amount of net operating losses available for utilization in the future.
The Company did not have any uncertain tax positions for the years ended December 31, 2025, and 2024, respectively.
Due to the full valuation allowance that the Company has on its net deferred tax asset balance, there are no uncertain tax positions that would impact the effective tax rate if recognized.
The Company is subject to U.S. federal, New York, California, Massachusetts, North Carolina, Texas, German and Australian income taxes. The Company is subject to U.S. federal or state income tax examination by tax authorities for tax returns filed for the years 2003 and forward due to the carryforward of NOLs. Tax years 2019 through 2025 are subject to audit by German and Australian tax authorities. The Company is currently under examination by German tax authorities for its Immunic AG and Immunic GMBH subsidiaries for the years ended 2021-2023.
Immunic, Inc. recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. Accrued interest and penalties are included on the related tax liability line in the consolidated balance sheet. There were no such interest or penalties for any of the years presented.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Mar 31, 2025 | |
| 2023 | Feb 22, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Mar 16, 2020 | |
| 2018 | Mar 4, 2019 | |
| 2017 | Mar 13, 2018 | |
| 2016 | Mar 7, 2017 | |
| 2015 | Mar 8, 2016 | |
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.