Registration of securities issued in business combination transactions

INCOME TAX

v3.24.0.1
INCOME TAX
12 Months Ended
Dec. 31, 2022
INCOME TAX  
INCOME TAX

NOTE 8. INCOME TAX

The Company’s net deferred tax assets at December 31, 2022 and 2021 were as follows:

    

December 31,

    

December 31,

2022

2021

Deferred tax assets

 

  

 

  

Net operating loss carryforward

$

$

3,844

Startup/Organizational expenses

 

147,861

 

31,151

Total deferred tax assets

 

147,861

 

34,995

Valuation allowance

 

(147,861)

 

(34,995)

Deferred tax assets, net of valuation allowance

$

$

The income tax provision for the years ended December 31, 2022 and 2021 consisted of the following:

    

Year Ended

    

Year Ended

December 31,

December 31,

2022

2021

Federal

  

  

Current

$

421,211

$

Deferred

 

(75,979)

 

(34,995)

State and Local

 

  

 

  

Current

 

 

Deferred

 

(36,886)

 

Change in valuation allowance

 

112,865

 

34,995

Income tax provision

$

421,211

$

As of December 31, 2022 and 2021, the Company had $0 and $18,306 of U.S. federal and state net operating loss carryovers available to offset future taxable income, respectively.

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, 2022 and 2021, the change in the valuation allowance was $112,865 and $34,995, respectively.

A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2022 and 2021 was as follows:

    

Year Ended

    

Year Ended

 

December 31,

December 31,

2022

2021

 

Statutory federal income tax rate

21.0

%  

21.0

%

State taxes, net of federal tax benefit

 

6.98

%  

0.0

%

Valuation allowance

 

8.86

%  

(21.0)

%

Income tax provision

 

36.84

%  

0.0

%