CV Sciences, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

For the years ended December 31, 2023 and 2022, pretax income (loss) was attributable to the following jurisdictions (in thousands):


	For the years ended December 31,
	2023			2022
Domestic operations	$	3,114		$	(8,261	)
Foreign operations		(18	)		—
Total	$	3,096		$	(8,261	)

Components of Income Tax Benefit

The income tax benefit for the years ended December 31, 2023 and 2022 was comprised of the following (in thousands):


	For the years ended December 31,
	2023			2022
Current:
Federal	$	—		$	—
State		8			4
Foreign		—			—
Total current tax expense		8			4
Deferred:
Federal		(11	)		(51	)
State		—			—
Foreign		(3	)		—
Total deferred tax benefit		(14	)		(51	)
Income tax benefit	$	(6	)	$	(47	)

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of the expected income tax benefit at the federal statutory rate of 21% for the years ended December 31, 2023 and 2022, and the income tax benefit reported in the financial statements is as follows:


	For the years ended December 31,
	2023						2022
	Amount			% of pretax income (loss)			Amount			% of pretax income (loss)
	(in thousands)						(in thousands)
Income tax expense (benefit) at federal statutory rate	$	651			21.0	%	$	(1,735	)		21.0	%
State taxes, net of federal effect		182			5.9			(456	)		5.5
Other permanent differences		33			1.1			21			(0.3	)
Stock-based compensation		420			13.5			1,795			(21.7	)
NOL adjustments and other true-ups		(640	)		(20.6	)		722			(8.7	)
R&D tax credits		—			—			(1	)		—
Other		8			0.2			14			(0.2	)
Decrease in valuation allowance		(660	)		(21.3	)		(407	)		4.9
Income tax benefit	$	(6	)		(0.2	)%	$	(47	)		0.5	%

Schedule of Deferred Tax Assets And Liabilities

The following table summarizes the significant components of the Company's deferred tax assets and liabilities as of December 31, 2023 and 2022 (in thousands):


	December 31,
	2023			2022
Deferred tax assets:
Net operating loss carryforwards	$	10,804		$	9,280
Business credit carryforwards		939			948
Intangible assets		413			527
Stock-based compensation		4,075			4,416
Change to inventory		52			87
Operating lease liabilities		51			81
Accruals and reserves		565			2,351
Other		247			222
		17,146			17,912
Deferred tax liabilities:
Operating lease assets		(45	)		(73	)
Property and equipment		(97	)		(100	)
CanX intangible assets		—			(67	)
		(142	)		(240	)
Valuation allowance		(17,023	)		(17,683	)
Net deferred tax liabilities	$	(19	)	$	(11	)

Schedule of Unrecognized Tax Benefits

A reconciliation of the Company's unrecognized tax benefits for the years ended December 31, 2023 and 2022 is provided in the following table (in thousands):


	2023			2022
Balance as of January 1:	$	172		$	172
Increase in current year positions		—			—
Increase in prior year positions		—			—
Decrease in prior year positions		(2	)		—
Balance as of December 31:	$	170		$	172