Company: CPSH
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001437749-25-032553
Chunk: 7

Company: CPS TECHNOLOGIES CORP/DE/
Filing Date: 2025-10-31
Form: 10-Q
Item: Part I, Item 1
Chunk 7
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193      Expense 12.5% of 2022-2024  
  Q2 2026      -            187,193      187,193      Expense 12.5% of 2022-2024  
  Q3 2026      -            187,193      187,193      Expense 12.5% of 2022-2024  
  Q4 2026      -            187,193      187,193      Expense 12.5% of 2022-2024  
 ──────────────────────────────────────────────────────────────────────────────────
                                                      Rationale                   
  Totals       187,193      748,772      935,965                                  

Enhancement of Section 179 Expensing: The maximum Section 179 deduction is increased to $2.5 million, with a phase-out threshold beginning at $4 million. This expansion is expected to accelerate tax deductions for qualifying property and benefit capital investment strategies.

Permanent Reinstatement of 100% Bonus Depreciation: For qualified property acquired and placed in service after January 19, 2025, the Company may elect full expensing under Section 168(k), which is expected to accelerate tax deductions and reduce taxable income in applicable periods.

Modifications to FDII (now FDDEI): The deduction under Section 250 for foreign-derived intangible income is reduced to 33.34%, and eligibility criteria are narrowed. These changes may impact export-related tax incentives and deferred tax projections tied to U. S.-held IP.

The Company is currently evaluating the impact of these provisions on its financial statements and tax positions. While the changes are not expected to materially affect prior period results, they may influence future effective tax rates, deferred tax balances, and cash tax obligations. The Company will incorporate these changes into its tax planning and provision calculations for fiscal year 2025 and beyond. However, the full effect of these provisions will depend on the Company's future capital expenditures, R& E activities, financing arrangements, and international operations. The Company will incorporate these changes into its tax provision and planning beginning in fiscal year 2025.

(14) Subsequent Events: Equity capital raise

On October 8, 2025 the Company closed an equity raise underwritten by Roth Capital Partners (“ Roth”). Roth acquired3,450,000shares of the Company’s common stock at a price of $3.00per share. The net proceeds to the Company were $9,540,