MapLight Therapeutics, Inc. Income Taxes Disclosure

Since its inception in 2018, the Company has generated cumulative federal and state net operating loss and research and development credit carryforwards for which any net tax benefit has not been recorded due to uncertainty around utilizing these tax attributes within the respective carryforward periods.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law, which includes, among other provisions, changes to the U.S. corporate income laws, including allowing the immediate expensing of certain qualifying research and development costs and the permanent extension of certain provisions within the Tax Cuts and Jobs Act. The impacts of the OBBBA did not have a material impact on the 2025 consolidated financial statements, and the Company will continue to evaluate its impacts in future periods.

For the year ended December 31, 2025, the Company adopted ASU 2023-09 on a prospective basis. A reconciliation of the U.S. federal statutory rate to the Company's effective tax rate for the year ended December 31, 2025, after the adoption of ASU 2023-09, is as follows (in thousands):

As of the years ended December 31, 2025 and 2024, the Company had federal net operating loss carryforwards of $96.6 and $58.6 million, respectively, and state operating loss carryforwards of $13.1 million and $10.5 million, respectively, which may be available to offset future taxable income. The U.S. federal net operating loss carryforwards do not expire but are subject to 80% limitation and are available to reduce future taxable income indefinitely. The state net operating loss carryforwards are available to offset future taxable income and begin to expire in 2039. At December 31, 2025, the Company had federal and state research and development tax credit carryforwards of $13.3 and $0.2 million, respectively. At December 31, 2024, the Company had federal and state research and development tax credit carryforwards of $8.0 million and $0.1 million, respectively.

Pursuant to Section 382 of the Internal Revenue Code, and similar state tax law, certain substantial changes in the Company's ownership may result in a limitation on the amount of net operating loss carryforwards and tax carryforwards that may be used in future years. Utilization of the net operating loss ("NOL") and tax credit carryforwards may be subject to a substantial annual limitation under Section 382 of the Internal Revenue Code of 1986 due to ownership change limitations that have occurred previously or that could occur in the future. These ownership changes may limit the amount of NOL and tax credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively. The Company has completed a Section 382 study through December 31, 2025, and identified one ownership change in 2019 that did not have a material impact on the Company’s tax attributes. The Company will continue to evaluate changes in ownership and the related limitations on a go forward basis.

ASC 740 requires a valuation allowance to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. After consideration of all the evidence, both positive and negative, the Company recorded a valuation allowance against deferred tax assets at December 31, 2025 because the Company determined that it is more likely than not that the Company will not recognize the benefits of the Company's federal and state deferred tax assets primarily due to the Company's cumulative loss position and, as a result of the net change in the total valuation allowance between 2025 and 2024 resulted in an increase of $39.6 million.

The Company applies the authoritative guidance on accounting for and disclosure of uncertainty in tax positions, which requires the Company to determine whether a tax position of ours is more likely than not to be sustained upon examination, including resolution of any related appeals of litigation processes, based on the technical merits of the position. For tax positions meeting the more likely than not threshold, the tax amount recognized in the financial statements is reduced by the largest benefit that has a greater than fifty percent likelihood of being realized upon the ultimate settlement with the relevant taxing authority. As of the years ended December 31, 2025 and 2024, the Company had no unrecognized tax benefits. The Company's policy is to record interest and penalties related to income taxes as a component of income tax expense. As of the years ended December 31, 2025 and 2024, the Company had no accrued interest or penalties related to income taxes and no amounts have been recognized in the Company's statement of operations and comprehensive loss.

The Company files income tax returns in the U.S., Massachusetts, and California. The statute of limitations for assessment by the Internal Revenue Service and Massachusetts tax authorities remains open for all years since

2019. To the extent the Company has tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service or state authorities to the extent utilized in a future period. No federal or state tax audits are currently in process.