12. Income Taxes

During the years ended December 31, 2025 and 2024 the Company incurred pre-tax losses from its domestic operations of $23,487 and $33,971, respectively.

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During the years ended December 31, 2025 and 2024, the Company recorded no current or deferred income tax expenses or benefits as the Company has incurred losses since inception and has provided a full valuation allowance against its deferred tax assets.

The Tax Cuts and Jobs Act of 2017 required the Company to capitalize and subsequently amortize research and development expenditures over five years for research activities conducted in the United States and over fifteen years for research activities conducted outside of the United States, effective January 1, 2022. On July 4, 2025, the One Big Beautiful Bill Act was enacted in the U.S. and introduced significant changes, including retroactive relief for certain small business taxpayers, such as reinstatement of immediate expensing for domestic research and development expenditures and modifications to the business interest expense limitation. As a result, the Company amended its federal and state income

tax returns for tax years 2022 through 2024 to reflect the immediate expensing of domestic research and development expenditures.

The Company adopted ASU 2023-09 "Income Taxes (Topic 740): Improvements To Income Tax Disclosures" on a retrospective basis beginning with the year ended December 31, 2025. A reconciliation of the U.S. federal statutory amount and rate to the Company’s effective income tax amount and rate for the year ended December 31, 2025 and December 31, 2024 is as follows:

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The Company’s deferred tax assets and liabilities consist of the following:

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The Company has evaluated the positive and negative evidence bearing upon its ability to realize the deferred tax assets as of December 31, 2025 and 2024. Management has considered the Company’s history of cumulative net losses and has concluded that as of December 31, 2025 and 2024, that it was more likely than not that the Company will not realize all of the benefits of the deferred tax assets. Accordingly, a full valuation allowance has been established against the deferred tax assets as of December 31, 2025 and 2024. The valuation allowance increased by $6,626 and $7,193 for the years ended December 31, 2025 and 2024, respectively. The increase in valuation allowance in 2025 was primarily a result of operating losses and tax credits generated.

The Company incurred net operating losses (“NOL”) since inception through December 31, 2025. As of December 31, 2025, the Company had federal net operating loss carryforwards of $136,687 net of amounts limited under Section 382. Included in federal net operating loss carryforwards of $136,687 is $25,639 that begin to expire in 2029 and $111,048 that can be carried forward indefinitely. As of December 31, 2025, the Company had state net operating loss carryforwards of $54,849, available to reduce future state taxable income, which will begin to expire in 2027. As of December 31, 2025, the Company also had $4,463 of federal research and development tax credit carryforwards available to reduce future income taxes, which will begin to expire in 2029, if not utilized. During the year ended December 31, 2024, the Company ceased operations of its wholly owned foreign subsidiary. As a result, all foreign net operating loss and research tax credit carryforwards were written off with an offsetting decrease to the valuation allowance.

Utilization of the Company’s net operating loss carryforwards and research and development tax credit carryforwards may be subject to a substantial annual limitation under Section 382 of the Internal Revenue Code of 1986 due to ownership changes that have occurred previously or that could occur in the future. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50% over a rolling three-year period. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income or tax. The amount of the limitation is determined based on the value of the Company immediately prior to the ownership change and could be subject to additional adjustments as required. Any limitation may result in expiration of a portion of the net operating loss carryforwards or research and development tax credit carryforwards before utilization. In 2023, the Company completed an analysis covering the periods from inception through December 31, 2022 to determine whether there may have been a Section 382 ownership change. This analysis showed an ownership change occurred in January 2009 and the Section 382 limitation would result in $589 of federal net operating loss carryforwards expiring unutilized.  The Company updated the analysis through December 31, 2024 and determined that it is more-likely-than-not that an ownership change did not occur in 2023 and 2024. An assessment to determine whether there may have been a Section 382 ownership change occurred during 2025 has not be completed. If a change in ownership were to have occurred during the period, and resulted in the restriction of net operating loss and tax credit carryforwards, the reduction in the related deferred tax asset would be offset with a corresponding reduction in the valuation allowance.

The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by federal and state jurisdictions, where applicable. Several tax returns are under examination. The Company is open to further tax examination under statute for tax years beginning on or after January 1, 2022; however, carryforward attributes that were generated prior to January 1, 2022 may still be adjusted upon examination by federal, state or local tax authorities if they either have been or will be used in a future period.