Company: INSP
Filing Date: 2025-11-03
Form Type: 10-Q
Source: 0001609550-25-000053
Chunk: 40

Company: Inspire Medical Systems, Inc.
Filing Date: 2025-11-03
Form: 10-Q
Item: Part I, Item 1
Chunk 40
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 federal net operating loss carryforward as of December 31, 2024 was $51.3 million, which is not subject to expiration. In addition, net operating loss carryforwards for state income tax purposes of $88.0 million, of which we estimate that $4.1 million of Minnesota net operating loss will expire unused in 2025. We also have gross R&D credit carryforwards of $16.6 million as of December 31, 2024, which will expire at various dates beginning in 2030.Utilization of the net operating loss carryforwards and R&D credit carryforwards may be subject to an annual limitation due to the ownership change limitations provided by Section 382 and Section 383 of the Code and similar state provisions. During 2025, we finalized an updated analysis to determine whether an ownership change had occurred through December 31, 2024, and if a limitation exists. It was determined that December 11, 2018 was the only date on which we experienced an ownership change. The study concluded that none of the $126.5 million of federal net operating losses nor the $1.7 million of federal R&D credits that were accumulated on December 11, 2018 will expire unused solely due to the limitations under Sections 382 and 383 of the Code. Realization of the deferred tax assets is dependent upon the generation of future book income, if any, the amount and timing of which are uncertain. Based on available objective evidence, we believe it is more likely than not that the deferred tax assets are not recognizable and will not be recognizable until we have sufficient evidence to support their recognition. Accordingly, the net deferred tax assets have been fully offset by a valuation allowance. 

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Table of ContentsInspire Medical Systems, Inc. Notes to Consolidated Financial Statements (unaudited) (Table amounts in thousands, except share and per share amounts)

On July 4, 2025, the enactment of the One Big Beautiful Bill Act ("OBBBA") into law, marked a significant legislative development, resulting in substantial modifications to the U.S. tax code. The OBBBA influences multiple facets of taxation, including, but not limited to, bonus depreciation, the current-year expensing of research and development costs, and international tax regulations. The income taxes reported for the three months ending September 30, 2025 incorporates all relevant tax provisions of this new law.We had $0.1 million of tax payable on