Annual report pursuant to Section 13 and 15(d)

Income Tax

v3.22.4
Income Tax
12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Tax

NOTE 8. INCOME TAX

The Company’s net deferred tax assets (liabilities) as of December 31, 2022 and December 31, 2021 is as follows:

 

Deferred tax assets:

 

December 31,

2022

 

 

December 31,

2021

 

Start-up costs

 

$

293,772

 

 

$

22,065

 

Net operating loss carryforwards

 

 

 

 

 

37,103

 

Total deferred tax assets

 

 

293,772

 

 

 

59,168

 

Valuation allowance

 

 

(293,772

)

 

 

(59,168

)

Deferred tax assets, net of allowance

 

$

 

 

$

 

 

The income tax provision for the year ended December 31, 2022 and for the period from February 8, 2021 (inception) through December 31, 2021 consists of the following:

 

 

 

For the year ended December 31, 2022

 

 

For the period

from February

8, 2021

(inception)

through

December 31,

2021

 

Federal

 

 

 

 

 

 

 

 

Current

 

$

617,905

 

 

$

 

Deferred

 

 

(234,604

)

 

 

(59,168

)

State

 

 

 

 

 

 

 

 

Current

 

$

 

 

$

 

Deferred

 

 

 

 

 

 

Change in valuation allowance

 

 

234,604

 

 

 

59,168

 

Income tax provision

 

$

617,905

 

 

$

 

 

 

As of December 31, 2022 and December 31, 2021, the Company had available U.S. federal operating loss carry forwards of approximately $0 and $176,683, respectively, that may be carried forward indefinitely.

In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or 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 future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax assets, projected future taxable income and tax planning strategies in making this assessment. After consideration of all 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 year ended December 31, 2022 and for the period from February 8, 2021 (inception) through December 31, 2021, the change in the valuation allowance was $234,604 and $59,168, respectively.

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

 

 

 

For the year ended December 31, 2022

 

 

For the period

from February

8, 2021

(inception)

through

December 31,

2021

 

Statutory federal income tax rate

 

 

21.0

%

 

 

21.0

%

State taxes, net of federal tax benefit

 

 

0.0

%

 

 

0.0

%

Change in valuation allowance

 

 

12.9

%

 

 

(21.0

)%

Income tax provision

 

 

33.9

%

 

 

0.0

%

 

The Company files income tax returns in the U.S. federal jurisdiction which remain open and are subject to examination.