Company: MBIO
Filing Date: 2025-04-01
Form Type: 424B3
Source: 0001104659-25-030657
Chunk: 224

Company: MUSTANG BIO, INC.
Filing Date: 2025-04-01
Form: 424B3
Chunk 224
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Table of Contents

Company’s January 2017 capital raise, as
it appears to constitute an ownership change under Section 382. Additionally, under Section 382, annual use of the Company’s net
operating loss carryforwards to offset taxable income may be limited based on cumulative changes in ownership. The Company has not completed
an analysis to determine whether any such limitations have been triggered as of December 31, 2024. The Company has no income
tax effect due to the recognition of a full valuation allowance on all of its deferred tax assets as it believes that it is more likely
than not that the deferred tax assets will not be realized regardless of whether an “ownership change” has occurred.

There are no significant items determined to be
unrecognized tax benefits taken or expected to be taken in a tax return, in accordance with ASC 740 “Income Taxes” (“ASC
740”), which clarifies the accounting for uncertainty in income taxes recognized in the financial statements, that have been recorded
on the Company’s financial statements for the periods ended December 31, 2024 and 2023. The Company does not anticipate
a material change to unrecognized tax benefits in the next twelve months.

Additionally, ASC 740 provides guidance on the
recognition of interest and penalties related to income taxes. There were no interest or penalties related to income taxes that have been
accrued or recognized as of and for the periods ended December 31, 2024 and 2023.

The Company is subject to U.S. federal and various
state taxes. As of December 31, 2024, the earliest federal tax year open for the assessment of income taxes under the applicable
statutes of limitations is its 2021 tax year.

Beginning with the 2022 tax year, the Company
is required to capitalize research and development expenses for tax purposes as defined under Internal Revenue Code Section 174. For expenses
that are incurred for research and development in the U.S., the amounts will be amortized over 5 years, and for expenses that are incurred
for research and development outside the U.S., the amounts will be amortized over 15 years. As a result of Section 174 capitalization,
the Company recognized a deferred tax asset of $24.4 million.

In response to the COVID-19 pandemic, the Coronavirus Aid, Relief and Economic Security Act ("CARES Act") was signed into law on March 27, 2020