VIEMED HEALTHCARE, INC.VMD

VIEMED HEALTHCARE, INC. Income Taxes Disclosure

10-KFiled Mar 4, 20265 min read
Income Taxes
Income taxes are accounted for in accordance with the provisions of ASC Topic 740, which requires, among other things, a balance sheet approach to calculating deferred income taxes. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in its consolidated financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amounts and tax bases of assets and liabilities using enacted tax rates in the years in which the differences are expected to reverse.

The Company is required to make certain estimates and judgments about the application of tax law, the expected resolution of uncertain tax positions and other matters. In the event that uncertain tax positions are resolved for amounts different than the Company’s estimates, or the related statutes of limitations expire without the assessment of additional income taxes, the Company will be required to adjust the amounts of related assets and liabilities in the period in which such events occur. Such adjustment may have a material impact on the Company’s income tax provision and results of operations.

The Company is domiciled in Canada and files income tax returns in Canada, the United States, and various U.S. state jurisdictions. Substantially all of the Company’s operations and taxable income are generated in the United States. In fiscal year 2025, the Company adopted ASU 2023-09, Improvements to Income Tax Disclosures, which requires enhanced disaggregation and presentation of income tax information, including disclosures based on the Company’s jurisdiction of domicile. The adoption of this standard impacted the presentation and disclosure of income taxes but did not affect the Company’s consolidated results of operations, financial position, or cash flows.

At December 31, 2025 and 2024, the Company had no amounts recorded for unrecognized tax benefits. The Company recognizes interest and penalties related to income tax matters within income tax expense. The Company is generally not subject to examination by taxing authorities for years prior to 2022.
Effective Tax Rate Reconciliation

A reconciliation of the Canadian federal statutory income tax rate to the Company’s effective tax rate for the years ended December 31, 2025, 2024, and 2023 is as follows:
Year Ended
December 31, 2025December 31, 2024December 31, 2023
Canadian federal statutory income tax rate
15.0 %15.0 %15.0 %
Provincial and local income taxes (Canada), net of federal tax effect
— %— %— %
Foreign tax effects
United States federal statutory rate differential
6.0 %6.0 %6.0 %
United States state income taxes
3.4 %2.5 %3.8 %
Effect of changes in tax laws or rates enacted in the current period
— %0.8 %— %
Effect of cross-border tax laws
— %— %— %
Tax credits
— %— %— %
Changes in valuation allowances
— %— %(0.1)%
Nontaxable or nondeductible items
Share-based payment awards
(0.5)%(1.5)%(0.6)%
Executive Compensation Limitation5.1 %4.9 %2.2 %
Other
0.4 %1.7 %2.5 %
Changes in unrecognized tax benefits
— %— %— %
Other adjustments
— %— %— %
Effective tax rate29.4 %29.4 %28.8 %

The Canadian federal statutory income tax rate is used as the starting point for the effective tax rate reconciliation because Canada is the Company’s jurisdiction of domicile. Substantially all of the Company’s taxable income is earned in the United States. Accordingly, U.S. federal and state income taxes are presented as foreign tax effects. United States state income taxes exceeded the quantitative threshold for separate disclosure and are therefore presented separately within foreign tax effects.
Provision for Income Taxes

The significant components of the provision for income taxes for the years ended December 31, 2025, 2024, and 2023 are as follows:
Year Ended
December 31, 2025December 31, 2024December 31, 2023
Current taxes:
Federal (Canada)
$— $— $— 
Provincial (Canada)
— — — 
Foreign (United States federal)
2,282 7,310 4,242 
Foreign state (United States)
1,000 1,291 1,345 
Total current taxes$3,282 $8,601 $5,587 
Deferred taxes:
Federal (Canada)
$— $— $— 
Provincial (Canada)
— — — 
Foreign (United States federal)
2,963 (3,408)(991)
Foreign state (United States)
146 (432)(448)
Total deferred taxes$3,109 $(3,840)$(1,439)
Provision for income taxes$6,391 $4,761 $4,148 

Income (Loss) from Continuing Operations Before Income Taxes

The Company did not generate any income (loss) from continuing operations before income taxes in its jurisdiction of domicile, Canada, for the years ended December 31, 2025, 2024, and 2023. Substantially all income from continuing operations before income taxes was generated in the United States.

Income Taxes Paid

Income taxes paid (net of refunds received) were as follows for the years ended December 31, 2025, 2024, and 2023:

Year Ended
December 31, 2025December 31, 2024December 31, 2023
Federal (Canada)$— $— $— 
Provincial (Canada)— — — 
Foreign (United States federal)5,885 5,506 3,131 
Foreign state (United States)
1,505 1,321 435 
Total income taxes paid
$7,390 $6,827 $3,566 
Income taxes paid (net of refunds received) exceeded 5 percent of total income taxes paid in the following jurisdictions during the year ended December 31, 2025: United States (federal). No individual U.S. state jurisdiction exceeded the quantitative threshold for separate disclosure, and U.S. state income taxes paid are presented in the aggregate.
Deferred Income Taxes

Deferred income taxes are determined based on the temporary differences between the financial statement basis and the tax basis of assets and liabilities using enacted tax rates in the years in which the differences are expected to reverse. In assessing the realizability of deferred income tax assets, management considers whether it is more likely than not that all, or some portion, of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.

Management considers the scheduled reversal of deferred income tax liabilities and projected future taxable income in making this assessment. Management evaluates the need for valuation allowances on the deferred income tax assets according to the provisions of FASB ASC 740, Income Taxes. In making this determination, management assesses all available evidence, both positive and negative, available at the balance sheet date. This includes, but is not limited to, recent earnings, internally prepared income projections, and historical financial performance.

The significant components of the Company’s deferred tax assets and liabilities are as follows:

December 31, 2025December 31, 2024
Deferred tax assets:
State fixed asset and net operating losses$1,249 $824 
Goodwill4,037 6,053 
Allowance for doubtful accounts
7,895 5,107 
Accrued compensation and other
948 1,394 
Accrued phantom stock
643 637 
Stock-based compensation5,182 4,476 
Capitalized costs
— 1,514 
Lease liability
885 705 
Capital loss carryover
— 328 
Investments31 247 
Other218 193 
UNICAP
13 13 
Total deferred tax assets$21,101 $21,491 
Deferred tax liabilities:
Right-of-use asset$(888)$(709)
Property and equipment(14,901)(12,368)
Total deferred liabilities$(15,789)$(13,077)
Valuation allowance:
Net deferred tax asset before valuation allowance$5,312 $8,414 
Less: valuation allowance(23)(16)
Net deferred tax asset$5,289 $8,398 
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Historical Timeline

Fiscal YearFiled
2025Mar 4, 2026Showing above
2024Mar 10, 2025
2023Mar 6, 2024
2022Mar 2, 2023
2021Mar 7, 2022
2020Mar 3, 2021
2019Mar 4, 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.

Other Available Disclosures

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