Company: GAME
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004869
Chunk: 232

Company: GameSquare Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1B
Chunk 232
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000  
    $15,374,299 

    (1)
    None
    of the changes in fair value during the period were due to instrument-specific changes in credit risk.

    F-36

12.
                                            Income tax 

The
Company computes taxes using the asset and liability method in accordance with FASB ASC Topic 740, Income Taxes. Under the asset
and liability method, the Company determines deferred income tax assets and liabilities based on the differences between the financial
reporting and tax bases of assets and liabilities and measure them using currently enacted tax rates and laws. A valuation allowance
is provided for deferred tax assets that, based on available evidence, are more likely than not to be realized.

The
Company’s accounting for deferred taxes involves the evaluation of a number of factors concerning the realizability of its net
deferred tax assets. The Company primarily considered such factors as its history of operating losses, the nature of the company’s
deferred tax assets, and the timing, likelihood and amount, if any, of future taxable income during the periods in which those temporary
differences and carryforwards become deductible. The Company believes that it is more likely than not that the deferred tax assets will
be unable to be realized; accordingly, a full valuation allowance has been established and no deferred tax asset is shown in the Company’s
balance sheet. As of December 31, 2024 and 2023, a valuation allowance of $117.7 million and $66.8 million, respectively, was established
mainly due to the realizability of Federal, State, and Foreign NOLs that will not likely be realized.

The
components of net deferred taxes are as follows:

 Schedule of components of deferred taxes

    December 31, 2024  
    December 31, 2023 

    $  
    $ 
  
    Deferred tax assets 

    Charitable Contribution 
     206,308  
     3,876 
  
    Fixed Assets 
     341,926  
     - 
  
    Stock Compensation 
     735,725  
     - 
  
    Section 163(j) Interest limitation 
     2,495,754  
     - 
  
    Capital Gain 
     650,608  
     621,686 
  
    Unrealized Gain 
     821,893  
     821,893 
  
    Organization Costs 
     52,103