Company: CXAI
Filing Date: 2025-04-07
Form Type: 10-K
Source: 0001829126-25-002438
Chunk: 784

Company: CXApp Inc.
Filing Date: 2025-04-07
Form: 10-K
Item: Item 5
Chunk 784
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 not outweighs the negative evidence and thus it is more likely than not that the benefit from deferred tax asset may not be realized in foreseeable future. In view of this, valuation allowance has been created as at December 31, 2024.

The Company’s policy for recording interest and penalties associated with unrecognized tax benefits is to record such interest and penalties as interest expense and as a component of income tax expense. There were no amounts accrued for interest or penalties for the years ended December 31, 2024, and 2023. Management does not expect any material changes in its unrecognized tax benefits in the next year.

    F-36

A reconciliation of the federal income tax rate to the Company’s effective tax rate for the years ended December 31, 2024, and 2023 are as follows:

    Schedule of reconciliation of the federal income tax rate to the Company’s effective tax rate

    Successor

    Predecessor

    Year ended December 31, 2024

    Period fromMarch 15, 2023 toDecember 31,2023

    Period fromJanuary 1, 2023 toMarch 14,2023

    Statutory federal income tax rate

    21.00
    %

    21.00
    %

    21.00
    %
  
    Incentive stock options

    -
    %

    -
    %

    (0.30
    )%
  
    Change in fair value of derivative warrant liabilities

    (3.52
    )%

    (2.18
    )% 

    -
    %
  
    Goodwill impairment loss

    -
    %

    (14.34
    )%

    -
    %
  
    US-Foreign income tax rate difference

    %

    -
    %

    1.30
    %
  
    Permanent difference

    (2.04
    )%

    0.22
    %

    0.07
    %
  
    Cancellation of debt income

    %

    -
    %

    (101.38
    )%
  
    Rate differential on foreign earnings

    0.44
    %

    0.24
    %

    -
    %
  
    State taxes, net of federal tax benefit

    (0.24
    )%

    0.93
    %

    3.49
    %
  
    Current federal tax true-up

    (1.27