| Summary of Source Differences Between Income Taxes at the Federal Statutory Rate and the Provision for Income Taxes |
A summary of the sources of differences between income taxes at the federal statutory rate and the provision for income taxes for the years ended December 31, 2023 and 2022, respectively, is as follows:
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|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
|
|
2023 |
|
|
2022 |
|
Tax benefit at the statutory rate |
|
$ |
(4,346,294 |
) |
|
$ |
(2,967,112 |
) |
Increase (decrease) in taxes resulting from: |
|
|
|
|
|
|
State taxes |
|
|
(400,290 |
) |
|
|
(767,514 |
) |
Stock-based compensation |
|
|
82,430 |
|
|
|
102,560 |
|
Research and development tax credits |
|
|
(418,321 |
) |
|
|
(73,558 |
) |
Other |
|
|
(167,497 |
) |
|
|
24,868 |
|
Change in valuation allowance |
|
|
5,249,972 |
|
|
|
3,680,756 |
|
Total income tax expense (benefit) |
|
$ |
— |
|
|
$ |
— |
|
|
| Schedule of Components of Company's Deferred Income Tax Assets and Liabilities |
Significant components of the Company's deferred income tax assets and liabilities are as follows:
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|
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|
|
|
As of December 31, |
|
|
|
2023 |
|
|
2022 |
|
Deferred tax assets: |
|
|
|
|
|
|
Net operating loss carryforwards |
|
$ |
13,095,540 |
|
|
$ |
9,469,767 |
|
Research and development credits |
|
|
1,647,502 |
|
|
|
1,229,181 |
|
Capitalized pre-business expenses |
|
|
2,229,904 |
|
|
|
2,563,946 |
|
Accrued expenses |
|
|
124,458 |
|
|
|
26,290 |
|
Stock-based compensation |
|
|
899,453 |
|
|
|
481,062 |
|
Inventory reserve |
|
|
243,070 |
|
|
|
64,726 |
|
Operating lease liability |
|
|
127,116 |
|
|
|
158,388 |
|
Capitalized §174 research and development costs |
|
|
1,905,522 |
|
|
|
919,466 |
|
Total deferred tax assets before valuation allowance |
|
|
20,272,565 |
|
|
|
14,912,826 |
|
Less valuation allowance |
|
|
(19,756,671 |
) |
|
|
(14,506,698 |
) |
Total deferred tax assets |
|
|
515,894 |
|
|
|
406,128 |
|
Deferred tax liabilities |
|
|
|
|
|
|
Fixed assets |
|
|
(390,191 |
) |
|
|
(264,377 |
) |
Right-of-use assets |
|
|
(125,703 |
) |
|
|
(141,751 |
) |
Total deferred tax liabilities |
|
|
(515,894 |
) |
|
|
(406,128 |
) |
Net deferred tax asset (liability) |
|
$ |
— |
|
|
$ |
— |
|
|
| Schedule of Reconciliation of the Federal Income Tax Rate to the Company's Effective Tax Rate |
A reconciliation of the federal income tax rate to the Company’s effective tax rate for the years ended December 31, 2023 and 2022 is as follows:
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, |
|
|
|
2023 |
|
|
2022 |
|
Statutory federal income tax rate |
|
|
21.0 |
% |
|
|
21.0 |
% |
State taxes, net of federal tax benefit |
|
|
1.9 |
% |
|
|
5.4 |
% |
Stock-based compensation |
|
|
-0.4 |
% |
|
|
-0.7 |
% |
General business credits |
|
|
2.0 |
% |
|
|
0.5 |
% |
Other adjustments |
|
|
0.8 |
% |
|
|
-0.2 |
% |
Change in valuation allowance |
|
|
-25.3 |
% |
|
|
-26.0 |
% |
Income tax provision |
|
|
0.0 |
% |
|
|
0.0 |
% |
|