Company: MCW
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0000950170-25-024533
Chunk: 78

Company: Mister Car Wash, Inc.
Filing Date: 2025-02-21
Form: 10-K
Item: Item 1B
Chunk 78
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 allowance, we consider all available positive and negative evidence, including taxable income in prior carryback years (if carryback is permitted under the relevant tax law), the timing of the reversal of existing taxable temporary differences, tax planning strategies and projected future 

50 

taxable income. We adjust the valuation allowance in the period management determines it is more likely than not that we will not realize some or all of the deferred tax assets. For financial reporting purposes, we established valuation allowances of $262 and $286 at December 31, 2024 and 2023, respectively, to offset deferred tax assets. The current and prior year valuation allowance relates to state attributes and carryovers.Past ownership changes and other equity transactions may have triggered Sections 382 and 383 of the Internal Revenue Code, resulting in certain annual limitations on the utilization of existing federal and state net operating losses and credits. Such provisions may limit the potential future tax benefit to be realized by us from its accumulated net operating losses and tax credit carryforwards.We file income tax returns in the U.S. federal and various state tax jurisdictions and are subject to varying statutes of limitation in each jurisdiction. As of December 31, 2024, we are not under audit for federal or state income tax purposes. In general, our federal tax return may be subject to examination for the 2021 through 2023 tax years, while for state purposes, the 2020 through 2023 years are generally open to examination, with some states having either a three- or four-year statute of limitations. Our usage of NOL carryovers also permits taxing authorities to adjust aspects of tax returns that may be outside of these statutes of limitation.A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits is as follows:

        December 31,

        2024

        2023

        2022

        Tax contingencies at beginning of period
        $
        -

        $
        -

        $
        -

        Additions based on tax positions related to the current year
         
        83

        -

        -

        Additions based on tax positions related to prior years
         
        459

        -

        -

        Tax contingencies at end of period
        $
        542

        $
        -

        $
        -

      We had gross unrecognized tax benefits of $542 and $0 as of December 31, 2024 and 2023, respectively, related to federal and state R&D tax credits. All of the unrecognized tax benefits,