Mirum Pharmaceuticals, Inc.MIRM
Mirum Pharmaceuticals, Inc. Income Taxes Disclosure
Income Taxes
The provision for (benefit from) income taxes was based upon income (loss) before income taxes as follows (in thousands):
| Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| U.S. source | $ | (24,877) | $ | (89,937) | $ | (164,953) | ||||||||||||||
| Non-U.S. source | 3,450 | 3,025 | 2,529 | |||||||||||||||||
| Loss before income taxes | $ | (21,427) | $ | (86,912) | $ | (162,424) | ||||||||||||||
The components of the Company’s income tax provision for (benefit from) were as follows (in thousands):
| Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Provision for income taxes: | ||||||||||||||||||||
| Federal | $ | (80) | $ | 32 | $ | 37 | ||||||||||||||
| State | 819 | 249 | 67 | |||||||||||||||||
| Foreign | 1,197 | 749 | 887 | |||||||||||||||||
| 1,936 | 1,030 | 991 | ||||||||||||||||||
| Benefit from deferred income taxes: | ||||||||||||||||||||
| Federal | — | — | — | |||||||||||||||||
| State | — | — | — | |||||||||||||||||
| — | — | — | ||||||||||||||||||
| Provision for (benefit from) income taxes | $ | 1,936 | $ | 1,030 | $ | 991 | ||||||||||||||
Beginning in 2025 annual reporting, the Company adopted ASU 2023-09 prospectively. See Note 2 for additional details on the adoption of ASU 2023-09. A reconciliation of the U.S. federal statutory income tax rate to the
effective tax rate pursuant to the disclosure requirements of ASU 2023-09 for the year ended December 31, 2025 is as follows (in thousands, except percentages):
| Year Ended December 31, 2025 | ||||||||||||||
| Loss before provision of income taxes | $ | (21,427) | ||||||||||||
| Provision for income taxes at U.S. Federal statutory rate | (4,500) | 21.00 | % | |||||||||||
State income taxes, net of Federal effect (1) | 641 | (2.99) | % | |||||||||||
| Foreign tax effects | ||||||||||||||
| Switzerland | ||||||||||||||
| Foreign rate differential | (285) | 1.33 | % | |||||||||||
| Cantonal tax impacts | 106 | (0.49) | % | |||||||||||
| Other | (42) | 0.20 | % | |||||||||||
| Other foreign jurisdictions | 695 | (3.24) | % | |||||||||||
| Effects of cross-border tax laws | ||||||||||||||
| Subpart F | 527 | (2.46) | % | |||||||||||
| Change in valuation allowance | 11,778 | (54.97) | % | |||||||||||
| Nontaxable or nondeductible items | ||||||||||||||
| Stock-based compensation | (5,167) | 24.11 | % | |||||||||||
| Executive compensation | 4,189 | (19.55) | % | |||||||||||
| Intercompany sale | 2,943 | (13.74) | % | |||||||||||
| Transaction costs | 440 | (2.05) | % | |||||||||||
| Other | 83 | (0.39) | % | |||||||||||
| Tax credits | (12,629) | 58.94 | % | |||||||||||
| Changes in unrecognized tax benefits | 3,157 | (14.74) | % | |||||||||||
| Total tax provision | $ | 1,936 | (9.04) | % | ||||||||||
__________________
(1)State taxes in Florida, Texas and Michigan made up majority (greater than 50%) of the tax effect in this category.
A reconciliation of the federal statutory income tax rate to the Company’s effective income tax rate for the years ended December 31, 2024 and 2023 is as follows:
| Year Ended December 31, | ||||||||||||||
| 2024 | 2023 | |||||||||||||
| Federal statutory income tax rate | 21.00 | % | 21.00 | % | ||||||||||
| State tax | 3.95 | 3.57 | ||||||||||||
| Permanent differences | 0.03 | (0.50) | ||||||||||||
| Other | (0.38) | 1.12 | ||||||||||||
| Section 162(m) limitation | (3.29) | (1.33) | ||||||||||||
| Foreign source income subject to U.S. tax | (0.45) | (1.69) | ||||||||||||
| Orphan Drug and General Business Credit | 7.50 | 1.91 | ||||||||||||
| Change in valuation allowance | (29.54) | (24.69) | ||||||||||||
| Total tax provision | (1.18) | % | (0.61) | % | ||||||||||
The amounts of income taxes paid, net of refunds received by the Company are as follows (in thousands):
| Year Ended December 31, 2025 | ||||||||
| Federal | $ | 53 | ||||||
| State and Local | ||||||||
| New York | 206 | |||||||
| Texas | 118 | |||||||
| Other | 762 | |||||||
| Foreign | ||||||||
| Netherlands | 256 | |||||||
| Canada | 201 | |||||||
| Germany | 166 | |||||||
| Spain | 183 | |||||||
| Switzerland | 142 | |||||||
| Other | 70 | |||||||
| Income taxes paid, net of amounts refunded | $ | 2,157 | ||||||
The significant components of the Company’s deferred taxes are as follows (in thousands):
| December 31, | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| Deferred tax assets: | ||||||||||||||
| Net operating loss carryforwards | $ | 45,302 | $ | 38,404 | ||||||||||
| Capitalized research and development expenses | 48,776 | 51,694 | ||||||||||||
| Tax credit carryforwards | 49,303 | 37,260 | ||||||||||||
| Interest limitation attributes | 10,610 | 14,008 | ||||||||||||
| Stock-based compensation | 9,875 | 9,949 | ||||||||||||
| Intangible assets | 8,976 | 6,664 | ||||||||||||
| Accrued expenses | 7,074 | 5,140 | ||||||||||||
| Inventory | 1,769 | 4,097 | ||||||||||||
| Lease liabilities | 1,762 | 2,144 | ||||||||||||
| Total deferred tax assets | 183,447 | 169,360 | ||||||||||||
| Deferred tax liabilities: | ||||||||||||||
| Operating lease right-of-use assets | (1,531) | (1,885) | ||||||||||||
| Fixed assets | (94) | (83) | ||||||||||||
| Total deferred tax liabilities | (1,625) | (1,968) | ||||||||||||
| Valuation allowance | (181,822) | (167,392) | ||||||||||||
| Net deferred tax assets | $ | — | $ | — | ||||||||||
The valuation allowance increased by $14.4 million, $24.2 million and $40.2 million for the years ended December 31, 2025, 2024, 2023, respectively. The tax benefit of deductible temporary differences or carryforwards is recorded as a deferred tax asset to the extent that management assesses the realization is “more likely than not.” Future realization of the tax benefit ultimately depends on the existence of sufficient taxable income within the period available under the tax law. At December 31, 2025 and 2024, the Company has set up valuation allowances against all federal and state net deferred tax assets, because based on all available evidence, these deferred tax assets are not more than likely to be realizable.
As of December 31, 2025, the Company had the following net operating loss and tax credit carryforwards, which if not utilized, will expire as follows (in millions, except for expiry):
| Type | Amount | Year | ||||||||||||
| Federal net operating loss carryforwards | $185.9 | Indefinite | ||||||||||||
| Federal R&D and orphan drug credit carryforwards | $57.3 | 2039 | ||||||||||||
| State net operating loss carryforwards | $105.1 | 2038 | ||||||||||||
| State R&D and orphan drug credit carryforwards | $10.8 | Indefinite | ||||||||||||
In general, if the Company experiences a greater than 50 percentage point aggregate change in ownership of certain significant stockholders over a three-year period (a “Section 382 ownership change”), utilization of its pre-change NOL carryforwards and the research and development credit carryforwards is subject to an annual limitation under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, and similar state laws. The annual limitation generally is determined by multiplying the value of the Company’s stock at the time of such ownership change, subject to certain adjustments, by the applicable long-term tax-exempt rate. Such limitations may result in expiration of a portion of the NOL carryforwards and research and development credit carryforwards before utilization and may be material. As of December 31, 2025, the Company determined that it has not experienced an ownership change and determined that NOLs and tax credits are not subject to a limitation pursuant to Section 382.
The Company recognizes the financial statements effects of a tax position when it is more likely than not, based on technical merits, that the position will be sustained upon examination.
A reconciliation of the Company’s unrecognized tax benefits is as follows (in thousands):
| Year Ended December 31, | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| Balance at beginning of year | $ | 12,965 | $ | 10,454 | ||||||||||
| (Decreases)/increases related to prior year tax positions | (110) | 337 | ||||||||||||
| Increases related to current year tax positions | 4,269 | 2,174 | ||||||||||||
| Balance at end of year | $ | 17,124 | $ | 12,965 | ||||||||||
The Company has considered the amounts and probabilities of the outcomes that can be realized upon ultimate settlement with the tax authorities and determined unrecognized tax benefits primarily related to credits should be established as noted in the summary roll-forward above. The Company’s effective income tax rate would not be impacted if the unrecognized tax benefits were recognized in 2025 and 2024, as the Company is in a full valuation allowance position.
The Company files federal, state and foreign income tax returns in jurisdictions with varying statutes of limitations. All of the Company’s tax returns in all jurisdictions remain open to examination since inception. The Company’s policy is to recognize interest expense and penalties related to income tax matters as tax expense. As of December 31, 2025 and 2024, there were no significant accruals for interest related to unrecognized tax benefits or tax penalties.
The Company has not provided U.S. income or foreign withholding taxes on the undistributed earnings of its foreign subsidiaries as of December 31, 2025 and 2024, because it intends to permanently reinvest such earnings outside of the U.S. If these foreign earnings were to be repatriated in the future, the related U.S. tax liability will be immaterial, due to the participation exemption put in place in the Tax Act.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 25, 2026 | Showing above |
| 2024 | Feb 26, 2025 | |
| 2023 | Mar 15, 2024 | |
| 2022 | Mar 8, 2023 | |
| 2021 | Mar 9, 2022 | |
| 2020 | Mar 9, 2021 | |
| 2019 | Mar 12, 2020 | |
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.