v3.26.3
Income Tax Provision
 12 Months Ended
Jun. 30, 2026
Income Tax Provision  
Income Tax Provision

Note 10 – Income Tax Provision

The Company has no current tax expense due to its losses.

The significant components of the Company’s deferred tax assets and liabilities at June 30, 2026 and 2025 are as follows:

​

​

​

​

​

​

​

​

​

  ​ ​ ​

June 30, 

  ​ ​ ​

June 30, 

​

​

2026

​

2025

Net operating loss

​

$

32,205,489

​

$

31,115,532

Research and development credit

​

 

8,115,396

​

 

8,600,732

IRC Sec.174 R&E Capitalization

​

 

3,189,154

​

 

2,748,509

Other

​

 

11,412

​

 

27,271

​

​

​

​

​

​

​

Total gross deferred tax assets

​

 

43,521,451

​

 

42,492,044

Less: valuation allowance

​

 

(43,521,451)

​

 

(42,492,044)

Net deferred tax asset

​

$

—

​

$

—

​

The Company made no cash payments for income taxes during the year ended June 30, 2026. Accordingly, there were no income taxes paid, net of refunds, during the year that require disaggregation by federal, state, or foreign jurisdiction.

​

A reconciliation of the Company’s statutory income tax rate to the Company’s effective income tax rate for the year ended June 30, 2026, is as follows:

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​

​

​

​

​

​

For the Year Ended

  ​ ​ ​

  ​ ​ ​

 

​

​

June 30,

​

​

 

​

​

2026

​

​

 

​

  ​ ​ ​

$

  ​ ​ ​

%

 

Net loss before income taxes

​

$

(8,218,509)

​

  ​

​

US federal statutory tax rate

​

​

(1,725,887)

​

(21.00)

%

State income taxes, net of federal income tax effect

​

​

—

​

0.00

%

Tax credits

​

​

  ​

​

  ​

​

R&D Credit

​

​

(152,901)

​

(1.86)

%

Changes in valuation allowance

​

​

805,734

​

9.80

%

Other adjustments

​

​

  ​

​

  ​

​

Forgone benefit on federal tax NOLs

​

​

592,729

​

7.21

%

Forgone benefit on federal R&D Credit

​

​

437,639

​

5.33

%

Other adjustments - Other

​

​

42,686

​

0.52

%

Effective tax rate

​

$

—

​

0.00

%

​

A reconciliation of the Company’s statutory income tax rate to the Company’s effective income tax rate for the year ended June 30, 2025, is as follows:

​

​

​

​

​

​

​

For the Year Ended

​

​

  ​ ​ ​

June 30, 

​

​

​

2025

​

Federal Statutory Rate

 

(21.00)

%

Research and Development Credit

 

4.71

%

State Tax Rate

 

(5.93)

%

Nondeductible Expenses

​

(0.01)

%

Other

 

(0.75)

%

Valuation Allowance

 

22.98

%

Effective Tax Rate

 

—

 

​

At June 30, 2026 and 2025, the Company has recorded a full valuation allowance against its net deferred tax assets of $43,521,451 and $42,492,044, respectively, since in the judgment of management, these assets are not more than likely than not to be realized.

As of June 30, 2026, the Company has approximately $119.9 million of gross net operating loss carryforwards available to reduce future taxable income, if any for federal and state tax purposes. The aggregate federal net operating losses generated for the tax years beginning after December 31, 2017 is approximately $49.3 million and can be carried forward indefinitely. However, the deduction for net operating losses incurred in tax years beginning after December 31, 2017 is limited to 80% of annual taxable income. Net operating losses generated in years ended June 30, 2018 and prior have a 20-year carryforward and began expiring in 2025. As of June 30, 2026 and 2025, research and development credit carryforwards for federal and state purposes are $8,115,396, and $8,600,732, respectively. The state net operating loss and credit carryforwards began to expire in 2025.

Due to the change in ownership provisions of the Internal Revenue Code, the availability of the Company’s net operating loss carry-forwards could be subject to annual limitations against taxable income in future periods, which could substantially limit the eventual utilization of such carryforwards. The Company has not analyzed the historical or potential impact of its equity financings on beneficial ownership and therefore no determination has been made whether the net operating loss carryforward is subject to any Internal Revenue Code Section 382 limitation. To the extent there is a limitation, there could be a reduction in the deferred tax asset with an offsetting reduction in the valuation allowance.

The Company does not have any uncertain tax positions at June 30, 2026 and June 30, 2025 that would affect its effective tax rate. The Company does not anticipate a significant change in the amount of unrecognized tax benefits over the next twelve months. Because the Company is in a loss carryforward position, the Company is generally subject to US federal and state income tax examinations by tax authorities for all years for which a loss carryforward is available. If and when applicable, the Company will recognize interest and penalties as part of income tax expense.