Inmune Bio, Inc. Income Taxes Disclosure

NOTE 10 – INCOME TAXES

 

Loss before income taxes summarized by region was as follows:

 

(in thousands)		December 31, 2024				December 31, 2023
United States		$	22,603			$	20,286
Foreign			19,479				9,722
Total loss before income taxes			42,082				30,008

 

The provision for income taxes consists of the following components:

 

			December 31, 2024				December 31, 2023
Current expense (benefit)		$	-			$	-
Federal			-				-
State			-				-
Foreign			-				-
Current income tax expense			-				-
Deferred expense (benefit)			-				-
Federal			-				-
State			-				-
Foreign			-				-
Deferred income tax			-				-
Net deferred taxes		$	-			$	-

 

A reconciliation of income tax benefit computed using the federal statutory income tax rate to the Company’s tax expense is as follows:

 

(in thousands, except percentage)		December 31, 2024				December 31, 2023
Federal tax benefit at statutory rate (21%)		$	(8,837	)		$	(6,302	)
Stock-based compensation			1,297				1,143
State income tax benefit, net of federal tax effect			(320	)			(222	)
Foreign tax differential			(482	)			(241	)
Research credits			268				266
Other			2				3
Return to provision adjustment			2,052				335
Change in valuation allowance			6,020				5,018
Income tax benefit		$	-			$	-

The principal components of deferred tax assets and liabilities consist of the following at December 31, 2024 and 2023, respectively:

 

(in thousands)		December 31, 2024				December 31, 2023
Deferred tax assets
Stock-based compensation		$	2,142			$	2,208
Research and development			4,716				2,900
Federal NOL carryforwards			8,686				6,849
State NOL carryforwards			1,923				1,685
Foreign NOL carryforwards			8,221				5,965
Total deferred tax assets			25,688				19,607
Less valuation allowance			(25,688	)			(19,607	)
Net deferred tax assets		$	-			$	-

 

We file income tax returns in the United States, the United Kingdom and Australia. The Company is no longer subject to Internal Revenue Service tax examinations by tax authorities for years prior to 2021. The United Kingdom and Australia are no longer subject to income tax examination for years prior to 2023 and 2022, respectively.

 

As of December 31, 2024, the Company has a federal net operating loss carryforward of approximately $41.4 million, a United Kingdom net operating loss carryforward of $17.4 million and an Australia net operating loss carryforward of $19.7 million. The federal net operating loss carryforwards for 2017 will begin to expire in the year ending December 31, 2037. The remaining federal net operating loss carryforwards generated after 2017 have no expiration. The United Kingdom and Australia net operating losses have no expiration. The Company has net operating loss carryforwards in California and Florida of $14.9 million and $24.2 million, respectively, of which the California net operating losses will begin to expire in the year ending December 31, 2037, and the Florida net operating losses have no expiration.

 

The Company’s gross deferred tax assets of $25.7 million and $19.6 million at December 31, 2024 and 2023, respectively, primarily consist of net operating loss carryforwards for income tax purposes. A valuation allowance is required to be recorded when it is not more likely than not that some portion or all of the net deferred tax assets will be realized. Since the Company cannot be assured of generating taxable income and thereby realizing the net deferred tax assets, a full valuation allowance has been recorded. The change in the valuation allowance was $6,081,000 during the year ended December 31, 2024.

 

The Company recognizes uncertain tax positions in accordance with ASC 740 on the basis of evaluating whether it is more likely than not that the tax positions will be sustained upon examination by tax authorities. For those tax positions that meet the more-likely-than not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement. As of December 31, 2024, and 2023, the Company has no significant uncertain tax positions. There are no unrecognized tax benefits included on the balance sheet that would, if recognized, impact the effective tax rate. The Company does not anticipate there will be a significant change in unrecognized tax benefits within the next 12 months.