Company: FLYW
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000950170-25-027078
Chunk: 412

Company: Flywire Corp
Filing Date: 2025-02-26
Form: 10-K
Item: Item 5
Chunk 412
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 allowance of $13.8 million, which is primarily due to an increase of $12.7 million related to capitalized 

146

research and development costs in the U.S. The Company also recorded a valuation allowance of $1.3 million related to a foreign subsidiary, offset by a decrease of $0.2 million due to the release of valuation allowance in foreign entities. Changes in the valuation allowance are summarized as follows (in thousands): 

        Year Ended December 31,

        2024

        2023

        2022

        Valuation allowance at beginning of year
         
        $
        (40,444
        )
         
        $
        (37,627
        )
         
        $
        (23,864
        )

        Change recorded to income tax provision as part of    operations

        (3,747
        )

        (2,817
        )

        (13,763
        )

        Valuation allowance at end of year
         
        $
        (44,191
        )
         
        $
        (40,444
        )
         
        $
        (37,627
        )
       
      The Company permanently reinvests the earnings of its foreign subsidiaries. No additional income taxes have been provided on the indefinitely invested foreign earnings at December 31, 2024. The Company has approximately $51.2 million of unremitted earnings at December 31, 2024, which the Company believes to approximate the outside basis difference in its foreign subsidiaries. If these earnings were distributed, the Company could be subject to income taxes and foreign withholding taxes. As of December 31 2024, the amount of the unrecognized deferred taxes on these earnings are not material.As of December 31, 2024, 2023 and 2022, the Company accrued $1.3 million, $0.8 million and $0.8 million related to uncertain tax positions, inclusive of interest and penalties, respectively, which includes potential tax benefits of $1.0 million, $0.5 million and $0.6 million, respectively, that, when recognized, would impact the effective tax rate. As of December 31, 2024, $0.8 million of the reserve is reflected as a reduction to deferred taxes and the remaining balance is recorded as a component of other liabilities in the consolidated balance sheet.A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):

        Year Ended