Note 19. Income Taxes

In connection with the Business Combination (see Note 2 – Business Combination), Boost Run Holdings, LLC, previously treated as a nontaxable partnership for U.S. federal income tax purposes, became a wholly-owned disregarded entity of Boost Run, Inc. The Business Combination was accounted for as a reverse recapitalization for financial reporting purposes, with Boost Run Holdings, LLC identified as the accounting acquirer, as Boost Run Holdings, LLC’s legacy equity holders retained the majority of the voting power, board composition, and senior management of the combined company. Accordingly, the Business Combination did not result in a new basis of accounting, a step-up in the tax basis of Boost Run Holdings, LLC’s assets and liabilities, or the recognition of goodwill, and the tax consequences of the Business Combination are accounted for as a change in the tax status of an entity.

For the three and nine months ended September 30, 2026, the Company was able to make a reliable estimate of its annual effective tax rate (“AETR”) and, accordingly, calculated its interim tax provision by applying the estimated AETR to year-to-date ordinary loss, in accordance with ASC 740-270-30-6. In the prior interim period (three and six months ended June 30, 2026), the Company used the actual year-to-date effective tax rate, in accordance with ASC 740-270-30-18, because small changes in projected annual ordinary income produced disproportionately large changes in the estimated AETR. The Company’s current forecast of an annual ordinary loss that exceeds the year-to-date loss supports a reliable AETR estimate. The Company will continue to reassess at each interim period.

For the three months ended September 30, 2026, the Company recognized income tax benefit of $9,749, and for the nine months ended September 30, 2026, the Company recognized an income tax expense of $45,992, each recorded in benefit (provision) for income taxes in the interim condensed consolidated statement of operations. The Company’s benefit of $9,749 for the three months ended September 30, 2026, relates to ordinary operations for the period. The Company’s expense of $45,992 for the nine months ended September 30, 2026, primarily relates to the change in tax status due to the Business Combination. The Company’s effective tax rate for the three and nine months ended September 30, 2026, are 40.9% and negative 97.3%, respectively.

The Company recognized deferred tax liabilities and deferred tax assets for the cumulative temporary differences that existed as of the Closing date, resulting in income tax expense of $56,560, recorded to provision for income taxes in the interim condensed consolidated statement of operations and a deferred tax liability on the Company’s interim condensed consolidated balance sheet. The temporary differences were measured based on the Company’s best estimate of the carryover tax basis of the Company’s assets and liabilities as of the Closing date, including with respect to depreciation methods expected to be elected on the Company’s final partnership income tax return for the pre-Business Combination period, and using the enacted U.S. federal statutory rate of 21% and an estimated blended state rate reflecting the Company’s state footprint as of the measurement date. These estimates are based on the Company’s current expectations and preliminary discussions with its tax return preparers and are subject to change as the Company’s state footprint evolves and as the Company’s final pre-Business Combination tax returns are completed and filed. This item is treated as a discrete item for interim reporting purposes and is excluded from the year-to-date ordinary income and actual effective tax rate described above.

The Company is in a net deferred tax liability position, with recognized deferred tax liabilities exceeding recognized deferred tax assets and expects to generate sufficient future taxable income to realize its deferred tax assets. Accordingly, no valuation allowance was recorded against the deferred tax assets established in connection with the Business Combination.

Because the Company was not historically subject to entity-level income tax, income tax expense and the effective tax rate for the current-year periods presented are not comparable to the corresponding prior-year periods, which did not reflect income tax expense attributable to the Company’s operations.