v3.26.1
Income Tax Provision
 12 Months Ended
Jan. 31, 2026
Income Tax Disclosure [Abstract]  
Income Tax Provision Income Tax Provision
Provision for income taxes for the years ended January 31, 2026, 2025, and 2024 consisted of the following (in thousands):
January 31, 2026January 31, 2025January 31, 2024
Federal
Current$277 $764 $1,451 
Deferred996 192 251 
State and Local  
Current217 (14)342 
Deferred75 53 (36)
Income tax provision$1,565 $995 $2,008 
Beginning with fiscal year 2026 financial reporting, we adopted ASU 2023-09, "Income Taxes (topic 740): Improvements to Income Tax Disclosures," prospectively. A reconciliation of the U.S. federal statutory income tax rate to our effective tax rate pursuant to the disclosure requirements of ASU 2023-09 for the fiscal year ended January 31, 2026, is as follows (in thousands):
January 31, 2026
Pre-tax book income$6,851 
U.S. federal statutory rate1,439 21.0%
State income tax, net of federal benefit130 1.9%
Non-taxable or non-deductible items215 3.1%
Effect of enacted tax laws and rate changes22 0.3%
Return to provision and tax account true-up38 0.6%
Stock-based compensation(307)(4.5%)
Taxes not based on income and other, net28 0.4%
Income tax provision$1,565 22.8%
As previously disclosed for the fiscal years 2025 and 2024, prior to the adoption of ASU 2023-09, a reconciliation of the federal statutory tax rate to the effective income tax rate is as follows:
Year Ended
January 31, 2025		Year Ended
January 31, 2024
U.S. federal statutory rate21.0 %21.0 %
State income tax, net of federal benefit2.1 %3.3 %
Adjustments to deferred tax assets(1.1)%0.4 %
Non-deductible expenses - restricted stock units - vested(4.9)%(1.2)%
Non-deductible expenses - section 162(m) adjustment3.5 %— %
Non-deductible expenses - others0.2 %— %
Income tax provision20.8 %23.5 %

Cash paid for income taxes, net of refunds, received by jurisdiction pursuant to the disclosure requirements of ASU 2023-09 for the year ended January 31, 2026 is as follows (in thousands):
Federal$1,035 
State190 
Cash paid for income taxes, net of refunds received$1,225 
The Company is in a taxable income position and had no U.S. federal net operating loss carryforwards (“NOLs”) as of January 31, 2026 and 2025. The Company had state NOL carryforwards of approximately $7.3 million and $8.0 million as of January 31, 2026 and 2025, respectively, which are available to offset future taxable income and begin to expire in 2036.
In assessing the realization of deferred tax assets, management considers 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 future generation of 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. There was no valuation allowance on the Company's deferred tax assets as of January 31, 2026, 2025, and 2024.
The Company evaluated the provisions of ASC 740 "Income Taxes" related to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. ASC 740 prescribes a comprehensive model for how a company should recognize, present, and disclose uncertain positions that the Company has taken or expects to take in its tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. Differences between tax positions taken or expected to be taken in a tax return and the net benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits.” A liability is recognized (or amount of net operating loss carry-forward or amount of tax refundable is reduced) for an unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740.
If applicable, interest costs related to the unrecognized tax benefits are required to be calculated and would be classified as “Other expenses – Interest” in the consolidated statements of operations. Penalties would be recognized as a component of “Selling, general and administrative expenses.”
No interest or penalties on unpaid taxes were recorded during the fiscal years ended January 31, 2026, 2025 and 2024. As of January 31, 2026, 2025 and 2024, no liability for unrecognized tax benefits was required to be reported. The Company does not expect any significant changes in its unrecognized tax benefits in the next year.
We are subject to taxation in the United States and various states. As of January 31, 2026, tax years for January 31, 2023, 2024, and 2025 are subject to examination by the tax authorities.
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, introducing significant and wide-ranging changes to the U.S. federal tax system. Key provisions include the restoration of 100% bonus depreciation for certain qualified property and the return to immediate expensing of domestic research and experimental (“R&E”) expenditures.
The legislation also provides transition relief for previously capitalized R&E costs under IRC §174, allowing taxpayers to either immediately deduct remaining unamortized amounts or elect accelerated amortization. In addition, the law reinstates the use of EBITDA-based limitations for business interest expense under IRC §163(j) and makes several business tax provisions permanent. Less favorable provisions include new limitations on the deductibility of charitable corporate contributions.
The enactment of OBBBA resulted in a tax benefit to the Company primarily related to the immediate expensing of previously capitalized R&E costs and the application of 100% bonus depreciation on newly acquired fixed assets. The Company elected to fully deduct the remaining unamortized R&E costs and current-year R&E expenditures in the fiscal year ended January 31, 2026. Additionally, the Company applied 100% bonus depreciation to qualifying assets placed in service during the year.
The components of the Company’s deferred tax assets and liabilities as of January 31, 2026 and 2025 were as follows (in thousands):
Deferred Tax AssetsJanuary 31, 2026January 31, 2025
Net operating loss carryforwards$39 $16 
Stock-based compensation468 149 
Acquisition costs181 86 
Capitalized start-up and organization costs1 8 
Intangible assets211 80 
Right-of-use lease liability1,819 802 
Inventory74 53 
Bad debt45 22 
Capitalized R&D costs— 178 
Accrued payroll632 239 
Total deferred tax assets3,470 1,633 
Deferred Tax Liabilities
Fixed assets2,468 590 
Right-of-use lease asset1,815 785 
Total deferred tax liabilities4,283 1,375 
Net deferred tax asset$(813)$258