Annual report pursuant to Section 13 and 15(d)

Income Taxes

v3.23.3
Income Taxes
 12 Months Ended
Jun. 30, 2023
Income Taxes [Abstract]  
Income Taxes

21.    Income Taxes

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

​

​

​

​

​

​

​

​

​

​

For the Years Ended

​

​

June 30, 

​

 

2023

 

2022

Current – Federal and state

​

$

—

​

$

—

Deferred – Federal

    

​

(12,153)

    

​

(9,051)

Deferred – State

​

 

(637)

​

 

—

Total

​

 

(12,790)

​

 

(9,051)

Change in valuation allowance

​

 

12,790

​

 

9,051

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, 

​

    

2023

​

2022

Deferred tax assets (liabilities):

​

​

​

​

​

​

Net operating loss

​

$

42,951

​

$

35,829

Share-based compensation

​

 

883

​

 

1,248

Capitalized research and development costs

​

​

2,775

​

​

—

Research and development tax credits

​

 

1,764

​

 

1,764

Investment in equity security

​

​

395

​

​

370

Property, plant and equipment

​

​

121

​

​

(2,520)

Intangible assets

​

 

(42)

​

 

(71)

Operating and finance lease liabilities

​

​

1,363

​

​

—

Operating and finance lease ROU assets

​

​

(1,184)

​

​

—

Accrued expenses

​

 

529

​

 

145

Valuation allowance

​

 

(49,555)

​

 

(36,765)

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 $202.1 million are available to the Company as of June 30, 2023, of which $63.9 million will expire at various dates through 2039 and $138.2 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, 2023. In addition, the Company has net operating loss carry forwards from various states of approximately $35.2 million which expire from 2029 through 2042.

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

​

​

​

​

​

​

​

​

​

    

Years Ended

​

​

June 30, 

​

    

2023

​

2022

Statutory federal income tax rate

 

21

%  

​

21

%

State taxes, net of federal benefit

 

1

%  

​

—

%

Expiration and forfeiture of stock options

​

(2)

%  

​

—

%

Change related to iBio CDMO

 

—

%  

​

(3)

%

Change in valuation allowance

 

(20)

%  

​

(18)

%

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 2019 through 2022 tax returns generally remain open to examination by U.S. Federal authorities and by state tax authorities.