Company: MGLD
Filing Date: 2025-09-19
Form Type: 10-K
Source: 0001493152-25-014286
Chunk: 580

Company: Marygold Companies, Inc.
Filing Date: 2025-09-19
Form: 10-K
Item: Item 4
Chunk 580
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% 
     25.3%

    F-22

Tax
positions are evaluated in a two-step process. The Company first determines whether it is more likely than not that a tax position will
be sustained upon examination. If a tax position meets the more-likely-than-not recognition threshold it is then measured to determine
the amount of benefit to recognize in the financial statements. The tax position is measured as the largest amount of benefit that is
greater than 50% likely of being realized upon ultimate settlement. During the year ended June 30, 2024, the Company reduced the balance
of gross unrecognized tax benefits, which included interest and penalties, by $0.3 million to zero and the balance remained zero during
the year ended June 30, 2025.

As
of June 30, 2025 and 2024, the Company has federal net operating loss carryforwards of $9.4
million and $3.3
million,
respectively, and state net operating loss carryforwards of $6.9
million
and $3.4
million,
respectively. These state operating loss carryforwards begin to expire in 2045. The federal net operating loss carryforward will carryforward
indefinitely, but is subject to the 80% taxable income limitation.

The
Company files income tax returns in the United States, and various state and foreign jurisdictions. The federal, state and foreign income
tax returns are subject to tax examinations for the tax years 2020 through 2024 as of year ended June 30, 2025. To the extent
the Company has tax attribute carry forwards, the tax years in which the attribute was generated may still be adjusted upon examination
by the U.S. Internal Revenue Service, state or foreign tax authorities to the extent utilized in a future period. There were no ongoing
examinations by taxing authorities as of June 30, 2025.

The
Company recognizes interest and penalties related to uncertain tax positions in income tax expense. As of June 30, 2025 and 2024, the
Company accrued and recognized as a liability zero and $0.1 million, respectively, of interest and related penalties to uncertain tax
positions.

Congress enacted the One Big Beautiful Bill Act
(“OBBBA”), which was signed into law on July 4, 2025. This law changes or makes permanent certain tax laws for corporations,
including provisions relating to domestic research and development costs