Company: IOBT
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0000950170-25-047744
Chunk: 304

Company: IO Biotech, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1B
Chunk 304
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 Asset

        393

        441

        Fixed Assets

        22

        26

        Other Liabilities

        —

        12

        Total deferred tax liabilities

        415

        479

        Net deferred tax asset (liability)
         
        $
        —

        $
        —

      In 2017, the U.S. enacted the Tax Cuts and Jobs Act (the “2017 Tax Act”), which contained a provision that requires capitalization and amortization of research and development expenses for tax purposes starting in 2022. Previously, these expenses could be deducted in the year incurred. The implementation of this provision increased our deferred tax asset and valuation allowance by approximately $1.2 million and $2.1 million for the years ended December 31, 2024 and 2023.When realization of a deferred tax asset is more likely than not to occur, the benefit related to the deductible temporary differences attributable to operations is recognized as a reduction of income tax expense. Valuation allowances are provided against deferred tax assets when, based on all available evidence, it is considered more likely than not that some portion or all of the recorded deferred tax assets will not be realized in future periods. We cannot be certain that future income in Denmark will be sufficient to realize the Company’s deferred tax assets. Accordingly, a full valuation allowance has been provided against our net deferred tax assets in Denmark. We have also provided a full valuation allowance against our net deferred tax assets in the U.S. for IO Bio US, Inc and IO Biotech, Inc. The Company's valuation allowance increased by ($19.3) million and $22.9 million for the years ended December 31, 2024 and 2023, respectively. The increase for the years ended December 31, 2024 and 2023 is primarily the result of an increase in net operating loss carryforwards (“NOL carryforwards”) in Denmark. 

163

Available Carryforward Tax Losses As of December 31, 2024, we had NOL carryforwards of approximately $303.0 million that can be carried forward indefinitely according to Danish Tax Authority regulations. Uncertain Tax Positions We determine our uncertain tax positions based on whether and how much of a tax benefit taken by us in our tax filings is more likely than not to be sustained upon examination by the relevant income tax authorities. We determine whether it is more likely than not that a tax position will be sustained upon examination. If it is not more