Company: TEM
Filing Date: 2025-02-24
Form Type: 10-K
Source: 0000950170-25-025603
Chunk: 473

Company: Tempus AI, Inc.
Filing Date: 2025-02-24
Form: 10-K
Item: Item 2
Chunk 473
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)

        (23.11
        %)

        Total
         
        (0.04
        %)

        (0.14
        %)

        (0.02
        %)
       
       Net change in valuation allowance as follows (in thousands):  

        Year Ended December 31,

        2024

        2023

        2022

        Valuation Allowance, beginning of year
        $
        297,294

        $
        244,064

        $
        161,749

        Charges
         
        205,777

        52,878

        66,827

        Purchase accounting adjustments
         
        —

        352

        15,488

        Valuation Allowance, end of year
        $
        503,071

        $
        297,294

        $
        244,064

       For the year ended December 31, 2024, the Company recognized stock-based compensation windfall of $46.0 million (tax-effected). The Company’s income tax expense as recorded in the financial statements differs from the benefit computed by applying statutory tax rates to net loss before income taxes due to permanent differences related to the deductibility of certain expenses and the valuation allowance. Current income tax expense for the years ended December 31, 2024, 2023 and 2022, related to state and foreign expense was not material. As of December 31, 2024 the Company had federal net operating loss (“NOL”) carry forwards of $257.0 million (tax effected) and state NOL carry forwards of approximately $51.7 million (tax effected), which may be available to offset future taxable income. The federal NOLs will begin to expire in 2037 and the state NOLs will begin to expire in 2028. A full valuation allowance has been recorded against the NOL carry forwards. The Company files income tax returns in the U.S. federal jurisdiction and various state jurisdictions. Due to its operating loss carryforwards, the U.S. federal statute of limitations remains open for tax year 2016 and onward and the Company continues to be subject to examination by the Internal Revenue Service for tax years 2016 and later. The resolutions of any examinations are not expected to be material to these financial statements. As of December 31, 2024 and 2023, there are no penalties or accrued interest recorded in the