Company: LRHC
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032211
Chunk: 2126

Company: La Rosa Holdings Corp.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 7
Chunk 2126
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ized over the life of the related financing. Debt discounts and deferred costs
are recognized as a direct reduction in the carrying amount of the debt instrument on the consolidated balance sheets and are recognized
on the consolidated statements of operations to amortization of financing fees over the term of the related debt using the effective interest
method. For the years ended December 31, 2024 and 2023, the Company recorded amortization of debt discounts and debt issuance costs of
$649,138 and $1,016,644, respectively. Upon abandonment of a pending financing transaction, the related deferred financing costs are charged
to expense.

Deferred Offering Costs

The Company capitalized certain legal, accounting,
and other third-party fees that are directly associated with in-process equity financings as deferred offering costs until such financings
are consummated. After consummation of the equity financing, these costs are recorded in stockholders’ equity as a reduction of
additional paid-in capital. Should the planned equity financing be abandoned, the deferred offering costs would be expensed immediately
as a charge to operating expenses in the consolidated statement of operations. On October 12, 2023 the Company completed its IPO and incurred offering expenses of $2,544,459, which were recorded against
the proceeds received from the IPO. There were no deferred offering costs for the year ended December 31, 2024 or 2023.

F-13

Income Taxes

The Company accounts for income taxes under the
liability method, and deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between
the financial statement carrying values of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities
are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.
A valuation allowance is provided if it is determined that it is more likely than not that the deferred tax asset will not be realized.
The Company records interest (and penalties where applicable), net of any applicable related income tax benefit, on potential income tax
contingencies as a component of the income tax provision.

The Company evaluates and accounts for uncertain
tax positions using a two-step approach. Recognition (step one) occurs when the Company concludes that a tax position, based solely on
its technical merits, is more-likely-than-not to be sustainable upon examination. Measurement (step two) determines the amount of benefit
that is greater than 50% likely to be realized upon ultimate settlement with a taxing authority