Company: KPEA
Filing Date: 2025-01-14
Form Type: 10-K
Source: 0001493152-25-002124
Chunk: 319

Company: Kun Peng International Ltd.
Filing Date: 2025-01-14
Form: 10-K
Item: Item 8
Chunk 319
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As
of September 30, 2024, and 2023, the Company had generated gross net operating loss carryforwards in an amount of $7,664,881 and $5,618,681.
As of September 30, 2024 and 2023, our US entity generated gross net operating loss carryforwards in an amount of $1,204,891 and $1,001,412,
respectively, available to offset future taxable income. For net operating losses arising after December 31, 2017, the Tax Act limits
the Company’s ability to utilize NOL carryforwards to 80% of taxable income and carryforwards the NOL indefinitely. NOLs generated
prior to January 1, 2018, will not be subject to the taxable income limitation and will begin to expire in 2033 if not utilized.

The
Companies in Hong Kong incurred gross net operating loss carryforwards in an amount of $17,039 and $10,245 as of September 30, 2024 and
2023, respectively. The net operating loss generated in Hong Kong is carried forward indefinitely.

Our
entities in the PRC generated $6,442,951 and $4,607,024 gross net operating loss carryforwards as of September 30, 2024, and 2023, respectively.
Those net operating loss carryforwards can be used to offset taxable income in future periods and reduce the income taxes payable of
our PRC entities in those future periods and will expire 5 years from the date they were incurred if they are not used. If not utilized,
approximately $202,045, $1,310,952, $1,607,148, $1,669,648 and $1,653,159 will expire in the years 2025, 2026, 2027, 2028 and 2029, respectively.

At
this time, the Company considered it is more likely than not that its US, Hong Kong and PRC entities have sufficient taxable income in
the near future that will allow us to realize these DTAs. Therefore, the Company recorded a full valuation allowance against all of its
deferred tax assets as of September 30, 2024, and 2023. The Company intends to continue maintaining a full valuation allowance on its
deferred tax assets until there is sufficient evidence to support the reversal of all