Company: HROW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000925
Chunk: 616

Company: HARROW, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 2
Chunk 616
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 taxable income and tax liabilities. In general, an “ownership
change” as defined by Section 382 of the Code results from a transaction or series of transactions over a three-year period
resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain stockholders or
public groups. Since the Company’s formation, the Company has raised capital through the issuance of capital stock on several
occasions which, combined with the purchasing stockholders’ subsequent disposition of those shares, may have resulted in such
an ownership change, or could result in an ownership change in the future upon subsequent disposition.

As of December 31, 2024 and 2023, the Company
had approximately $2,858,000 and $2,822,000,
respectively of unrecognized tax benefits which, if fully recognized, would decrease its effective tax rate. Interest or penalties
of $69,000
and $40,000 were accrued relating to unrecognized tax benefits as of December 31, 2024 and 2023, respectively.

    F-41

A reconciliation of the change in the unrecognized
tax benefits balance for the years ended December 31, 2024 and 2023 is as follows:

SCHEDULE
OF UNRECOGNIZED TAX BENEFITS

    Federal & State Tax 
  
    Balance at January 1, 2024 
    $2,822,000 
  
    Additions for tax positions related to current year 
     5,000 
  
    Additions/(reductions) for tax positions related to prior years 
     32,000 

    Balance at December 31, 2024 
    $2,858,000 

    Federal & State Tax 
  
    Balance at January 1, 2023 
    $- 
  
    Additions for tax positions related to current year 
     36,000 
  
    Additions/(reductions) for tax positions related to prior years 
                      2,786,000 

    Balance at December 31, 2023 
    $2,822,000 

NOTE 17. EMPLOYEE
SAVINGS PLAN

The Company has established an employee savings plan
pursuant to Section 401(k) of the Internal Revenue Code, effective January 1, 2014. The plan allows participating employees to deposit
into tax deferred investment accounts up to 100% of their salary,