iBio Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes

Income Taxes

12 Months Ended

Jun. 30, 2022

Income Taxes [Abstract]

Income Taxes

22. Income Taxes

The components of net loss consist of the following (in thousands):


	For the Years Ended
	June 30,
	2022		2021
United States	$	(50,304)	$	(23,200)
Brazil		—		(13)
Total	$	(50,304)	$	(23,213)

The components of the provision (benefit) for income taxes consist of the following (in thousands):


	For the Years Ended
	June 30,
	2022		2021
Current – Federal and state	$	—	$	—
Deferred – Federal		(9,051)		(55)
Deferred – State		—		—
Total		(9,051)		(55)
Change in valuation allowance		9,051		55
Income tax expense	$	—	$	—

The Company has deferred income taxes due to income tax credits, net operating loss carryforwards, and the effect of temporary differences between the carrying values of certain assets and liabilities for financial reporting and income tax purposes.

The components of the Company’s deferred tax assets and liabilities are as follows (in thousands):


	As of June 30,
	2022		2021
Deferred tax assets (liabilities):
Net operating loss	$	35,829	$	24,693
Share-based compensation		1,248		353
Research and development tax credits		1,764		1,737
Investment in equity security		370		—
Basis in iBio CDMO		—		984
Property, plant and equipment		(2,520)		—
Intangible assets		(71)		(91)
Vacation accrual and other		145		38
Valuation allowance		(36,765)		(27,714)
Total	$	—	$	—

The Company has a valuation allowance against the full amount of its net deferred tax assets due to the uncertainty of realization of the deferred tax assets due to the operating loss history of the Company. The Company currently provides a valuation allowance against deferred taxes when it is more likely than not that some portion, or all of its deferred tax assets will not be realized. The valuation allowance could be reduced or eliminated based on future earnings and future estimates of taxable income.

Federal net operating losses of approximately $5.5 million were used by the Former Parent prior to June 30, 2008 and are not available to the Company. The Former Parent allocated the use of the Federal net operating losses available for use on its consolidated Federal tax return on a pro rata basis based on all of the available net operating losses from all the entities included in its control group.

U.S. federal net operating losses of approximately $170.5 million are available to the Company as of June 30, 2022, of which $63.9 million will expire at various dates through 2039 and $106.6 million with no expiration date. These carryforwards could be subject to certain limitations in the event there is a change in control of the Company pursuant to Internal Revenue Code Section 382, though the Company has not performed a study to determine if the loss carryforwards are subject to these Section 382 limitations. The Company has a research and development credit carryforward of approximately $1.76 million at June 30, 2022.

A reconciliation of the statutory tax rate to the effective tax rate is as follows:


	Years Ended
	June 30,
	2022		2021
Statutory federal income tax rate	21	%	21	%
Change related to iBio CDMO	(3)	%	—	%
Change in valuation allowance	(18)	%	(21)	%
Effective income tax rate	—	%	—	%

The Company has not been audited in connection with income taxes. iBio files U.S. Federal and state income tax returns subject to varying statutes of limitations. The 2018 through 2021 tax returns generally remain open to examination by U.S. Federal authorities and by state tax authorities. In addition, the 2015 through 2021 Brazilian federal tax returns remain open to examination by Brazil’s federal tax authorities.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
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-Section 50
-Paragraph 21
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
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-Section S99
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-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI https://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details