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Deferred income taxes are accounted for using the balance sheet approach, which requires recognition of deferred tax assets and liabilities for the expected future consequences of temporary differences between the financial reporting basis and the tax basis of assets and liabilities, as measured by enacted state and federal tax rates. Deferred tax assets and deferred tax liabilities are as follows:
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| (in thousands) |
December 31,
2025 |
|
December 31,
2024 |
| Deferred tax assets: |
|
|
|
| Net operating loss carryforwards |
$ |
46,519 |
|
|
$ |
37,323 |
|
| Inventory write down |
570 |
|
|
423 |
|
| Interest limitation |
1,208 |
|
|
— |
|
| Allowance for doubtful accounts |
245 |
|
|
204 |
|
| Lease obligations |
4,977 |
|
|
5,489 |
|
| Stock-based compensation |
4,435 |
|
|
7,371 |
|
| Capitalized research and development costs |
7,370 |
|
|
14,785 |
|
| Debt derivative liabilities |
1,005 |
|
|
622 |
|
| Charitable contributions |
17 |
|
|
31 |
|
| Accrued compensation |
21 |
|
|
49 |
|
|
|
|
|
| Total deferred tax assets |
66,367 |
|
|
66,297 |
|
| Deferred tax liabilities: |
|
|
|
| Depreciation |
(1,423) |
|
|
(949) |
|
| Amortization |
(741) |
|
|
(99) |
|
| Right-of-use asset |
(3,305) |
|
|
(3,708) |
|
| Contract liabilities |
— |
|
|
(86) |
|
| Total deferred tax liabilities |
(5,469) |
|
|
(4,842) |
|
| Net deferred tax assets |
60,898 |
|
|
61,455 |
|
| Valuation allowance |
$ |
(60,898) |
|
|
$ |
(61,455) |
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