v3.25.4
Income Taxes
 12 Months Ended
Dec. 31, 2025
Income Taxes [Abstract]  
INCOME TAXES

NOTE 9. INCOME TAXES

 

The Company’s net deferred tax assets are as follows: 

 

   December 31,   December 31, 
   2025   2024 
Deferred tax assets          
Net operating loss carryforward  $
-
   $
-
 
Startup Costs   248,509    137,879 
Total deferred tax assets   248,509    137,879 
Valuation allowance   (248,509)   (137,879)
Deferred tax assets, net of allowance  $
-
   $
-
 

 

The income tax provision for the years ended December 31, 2025 and 2024 consists of the following:

 

   December 31,   December 31, 
   2025   2024 
Federal          
Current  $579,272   $61,039 
           
Deferred   (110,630)   (47,668)
State          
Current  $
—
   $
—
 
Deferred   
—
    
—
 
Change in valuation allowance   110,630    47,668 
Income tax provision  $579,272   $61,039 

 

As of December 31, 2025 and 2024, the Company had a total of $0 and $0, respectively, of U.S. federal net operating loss carryovers available to offset future taxable income. The federal net operating loss can be carried forward indefinitely.

In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of 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 temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the years ended December 31, 2025 and 2024, the change in the valuation allowance was $110,630 and $47,668 respectively.

 

A reconciliation of the federal income tax rate to the Company’s effective tax rate is as follows:

 

   December 31,   December 31, 
   2025   2024 
Statutory federal income tax rate   21.0%   21.0%
State taxes, net of federal tax benefit   0.0%   0.0%
Change in fair value of warrants   0.0%   0.0%
Change in valuation allowance   5.0%   74.9%
Income tax provision   26.0%   95.9%

 

The Company’s effective tax rates for the periods presented differ from the expected (statutory) rates due to changes in fair value in warrants, transaction costs associated with warrants and the recording of full valuation allowances on deferred tax assets.

 

The Company files income tax returns in the U.S. federal jurisdiction in various state and local jurisdictions and is subject to examination by the various taxing authorities.