Company: ERAS
Filing Date: 2025-03-20
Form Type: 10-K
Source: 0000950170-25-042682
Chunk: 137

Company: Erasca, Inc.
Filing Date: 2025-03-20
Form: 10-K
Item: Item 16
Chunk 137
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 )

        (143,833
        )

        Net deferred tax assets
         
        $
        —

        $
        —

       The Company has established a valuation allowance against net deferred tax assets due to the uncertainty that such assets will be realized. The Company periodically evaluates the recoverability of the deferred tax assets. At such time as it is determined that it is more likely than not that deferred tax assets will be realizable, the valuation allowance will be reduced. The Company has recorded a full valuation allowance of $180.1 million as of December 31, 2024, as it does not believe it is more likely than not that the deferred tax assets will be realized primarily due to the generation of pre-tax book losses, the lack of feasible tax-planning strategies, the limited existing taxable temporary differences, and the subjective nature of forecasting future taxable income into the future. The Company increased its valuation allowance by $36.3 million during the year ended December 31, 2024. A reconciliation of the federal statutory income tax rate and the Company’s effective income tax rate is as follows: 

        Year ended December 31,

        2024

        2023

        Federal statutory income tax rate

        21.0
        %

        21.0
        %

        State income taxes, net of federal benefit

        0.1

        (9.8
        )

        Change in valuation allowance

        (22.5
        )

        (11.1
        )

        Other permanent differences

        (1.7
        )

        (1.6
        )

        Research and development credits

        3.7

        5.0

        State net operating loss

        —

        (0.4
        )

        Other

        (0.6
        )

        (3.1
        )

        Effective income tax rate

        —
        %

        —
        %
       
       At December 31, 2024, the Company had federal, California, and other state net operating loss (NOL) carryforwards of $251.8 million, $243.1 million, and $3.3 million, respectively. The federal NOL carryforwards will carryforward indefinitely and can offset 80% of future taxable income each year, the California NOL carryforwards begin to expire in 2038, and the other state NOL carryforwards begin to expire in 2036.