Meridian Holdings Inc./NV Income Taxes Disclosure

NOTE 20 – INCOME TAXES

Provision for Income Taxes

The components of the provision for income taxes were as follows:

Effective Tax Rate

The following table reconciles the U.S. statutory tax rate to our effective income tax rate for the year ended December 31, 2025, as required by ASU 2023-09 (see " Recently adopted accounting pronouncements" caption in for more information):

A reconciliation of the provision for income taxes to the amount computed by applying the 21% statutory U.S. federal income tax rate to income before income taxes for years prior to the adoption of ASU 2023-09 is as follows:

Cash Taxes Paid

The components of cash income taxes paid net of refunds are as follows:

Deferred Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the bases of assets and liabilities for financial reporting and income tax purposes. The Company's deferred tax assets and liabilities consisted of the following:

The Company assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. The valuation allowance disclosed in the table above relates to the foreign net operating loss carryforwards that may not be realized. The Company will continue to evaluate the need to adjust the valuation allowance. The amount of the deferred tax asset considered realizable, however, could be adjusted depending on the Company's performance in certain subsidiaries or jurisdictions.

Deferred taxes consist of net deferred tax assets of $0.5 million, inclusive of a valuation allowance of $2.7 million as of December 31, 2025. Our valuation allowance increased by $2.7 million for the year ended December 31, 2025, respectively, due primarily to foreign net operating losses. The Company does not anticipate any significant changes to the total amount of unrecognized deferred tax assets within the next 12 months following the reporting date. Deferred tax assets have not been recognized with respect to these items because it is not probably that future taxable profit will be available against which the Company can utilize the benefits.

As of December 31, 2025, the Company has gross foreign net operating loss carryforwards of $10.2 million. These net operating losses are eligible to be carried forward indefinitely. Recognition of some of these loss carryforwards is subject to an annual limit.

At December 31, 2025, the Company had no unrecognized tax benefits and does not anticipate any unrecognized tax benefits. Should the recognition of any interest or penalties relative to unrecognized tax benefits be necessary, it is the Company’s policy to record such expenses in the Company’s income tax accounts. No such accruals existed at December 31, 2025.

The Company is subject to examination in the United States, Serbia, and other foreign jurisdictions. As of December 31, 2025, tax years 2019 to 2025 are subject to examination by the tax authorities.