TriSalus Life Sciences, Inc.TLSI
TriSalus Life Sciences, Inc. Income Taxes Disclosure
Income Taxes
We utilize the balance sheet method of accounting for income taxes and deferred taxes which are determined based on the differences between the financial statements and tax basis of assets and liabilities given the provisions of the enacted tax laws.
The income tax expenses (benefits) from continuing operations are summarized as follows:
| December 31, 2024 | December 31, 2023 | ||||||||||
| Federal: | |||||||||||
| Current | $ | (15) | $ | — | |||||||
| Deferred | — | — | |||||||||
| (15) | — | ||||||||||
| State: | |||||||||||
| Current | 21 | 9 | |||||||||
| Deferred | — | — | |||||||||
| 21 | 9 | ||||||||||
| Total | $ | 6 | $ | 9 | |||||||
The provision for income taxes differs from income taxes computed at the federal statutory tax rates are due to the following items:
| December 31, 2024 | December 31, 2023 | ||||||||||
| Statutory rate | 21.0 | % | 21.0 | % | |||||||
| State and local taxes | 5.1 | 3.4 | |||||||||
| Change in valuation allowance | (33.1) | (22.0) | |||||||||
| Disallowed interest expense on convertible debt | — | — | |||||||||
| Prior year true-up | 1.7 | 1.0 | |||||||||
| Permanent differences | 5.3 | (3.4) | |||||||||
| — | % | — | % | ||||||||
The income tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and liabilities are presented below:
| December 31, 2024 | December 31, 2023 | ||||||||||
| Deferred tax assets: | |||||||||||
| NOL carryforwards | $ | 44,336 | $ | 37,322 | |||||||
| Fixed assets | 2,664 | 2,565 | |||||||||
| Accrued liabilities | 140 | 1,115 | |||||||||
| Inventory | 652 | 222 | |||||||||
| Interest limitation | 674 | — | |||||||||
| Charitable contributions | 33 | 37 | |||||||||
| Lease accounting | 52 | 46 | |||||||||
| Capitalized R&D expenses | 11,919 | 10,176 | |||||||||
| Stock-based compensation expense | 1,264 | 305 | |||||||||
| Total deferred income tax assets | 61,734 | 51,788 | |||||||||
| Deferred tax liabilities: | |||||||||||
| Prepaid expenses | (407) | (470) | |||||||||
| Total deferred income tax assets and liabilities | 61,327 | 51,318 | |||||||||
| Less: Valuation allowance | (61,327) | (51,318) | |||||||||
| Net deferred income tax assets and liabilities | $ | — | $ | — | |||||||
In assessing the realizability of our deferred tax assets, we consider whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. We consider the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. As we do not have any historical taxable income, projections of future taxable income over the
periods in which the deferred tax assets are deductible, and after consideration of the history of operating losses, we do not believe it is more likely than not that we will realize the benefits of the net deferred tax assets and, accordingly, have established a valuation allowance equal to 100% of net deferred tax assets. The change in the valuation allowance for the years ended December 31, 2024 and 2023 was $10.0 million and $13.2 million, respectively.
As of December 31, 2024, we had net operating losses (“NOLs”) as follows (the NOLs which do not expire are subject to an annual utilization limitation of 80% of taxable income):
| December 31, 2024 | |||||||||||
| Federal | State | ||||||||||
| NOLs expiring between 2029 and 2037 | $ | 43,912 | $ | 106,320 | |||||||
| NOLs which do not expire | 135,875 | 37,045 | |||||||||
| Total NOLs | $ | 179,787 | $ | 143,365 | |||||||
The Internal Revenue Code contains provisions that may further limit the net operating loss carryovers available to be used in any one year if certain events occur, including significant changes in ownership interests. Utilization of net operating loss and tax credit carryforwards are subject to a substantial annual limitation due to the ownership change limitations set forth in Section 382 of the Code and similar state provisions. We prepared an Internal Revenue Code 382 analysis to determine the annual limitations on our consolidated net operating loss carryforwards. All of our tax attributes are subject to an annual limitation. Such annual limitations could result in the expiration of the net operating loss and tax credit carryforwards before utilization.
As of December 31, 2024 and 2023, we did not have any unrecognized tax benefits and do not expect that the amount of unrecognized tax benefits will change significantly within the next 12 months. Our accounting policy is to accrue interest and penalties related to unrecognized tax benefits as a component of income tax expense.
We are subject to taxation in the United States, various state jurisdictions, and various foreign jurisdictions. We are subject to income tax examination by U.S. and state tax authorities for the calendar year ended December 31, 2024 and forward. However, to the extent allowed by law, the taxing authorities may have the right to examine prior periods where net operating losses and credits were generated and carried forward, and make adjustments up to the amount of the net operating losses and credits utilized in open tax years.
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.