Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 355

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 355
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 |     |      | 10,771,642 |   |
| Less: Valuation Allowance          |     |              | (10,309,361 | ) |     |      | (7,429,810 | ) |
| Deferred Tax Liabilities           |     |              |             |   |     |      |            |   |
| Investment in Flavored Bourbon LLC |     |              |  (2,511,373 | ) |     |      | (2,472,700 | ) |
| Right-of-Use Assets                |     |              |    (840,677 | ) |     |      |   (869,132 | ) |
| Total Deferred Tax Liabilities     |     |              |  (3,352,050 | ) |     |      | (3,341,831 | ) |
| Net Deferred Tax Assets            |     | $            |           — |   |     | $    |          — |   |

ASC 740 requires that the tax benefit of net operating
losses, temporary differences and credit carryforwards be recorded as an asset to the extent that management assesses that realization
is “more likely than not.” Realization of the future tax benefits is dependent on the Company’s ability to generate
sufficient taxable income within the carryforward period. Because of the Company’s recent history of operating losses, management
believes that recognition of the deferred tax assets arising from the above-mentioned future tax benefits is currently not likely to be
realized and, accordingly, has provided a valuation allowance. The change in the valuation allowance for the period ended December 31,
2023 was an increase of $2,879,551 and change in the valuation allowance for the period ended December 31, 2022 was an increase of $3,229,449.

<div align='center'>F-70

Heritage Distilling Holding Company, Inc.
Notes to Consolidated Financial Statements</div>

NOTE 10 — INCOME TAXES (cont.)

At December 31, 2023 and 2022, the Company has federal
net operating loss carryforwards of $49,287,572 and $40,443,870 respectively, which have an indefinite carryforward period. Under Sections
382 and 383 of the Code, substantial changes in our ownership may limit the amount of net operating loss and research that could be used
annually in the future to offset taxable income. The tax benefits related to future utilization of federal