Company: BWMN
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0001628280-25-012365
Chunk: 46

Company: Bowman Consulting Group Ltd.
Filing Date: 2025-03-12
Form: 10-K
Item: Item 15
Chunk 46
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, 2022, the Tax Cuts and Jobs Act (TCJA) of 2017 eliminated the option to deduct research and development expenditures in the current year and now requires taxpayers to capitalize and amortize research and development costs pursuant to Internal Revenue Code Section 174. The capitalized expenses are amortized over a 5-year period for domestic expenses and a 15-year period for foreign expenses. As a result of this provision of the TCJA, deferred tax assets reflect approximately $122 million and $92 million of pre-tax capitalized and amortizable research and development costs for the years ended December 31, 2024 and 2023, respectively.The Company’s tax attributes, including research and development credits, are subject to any ownership changes as defined under the Internal Revenue Code Sections 382 and 383. A change in ownership could affect the Company’s ability to utilize its credits and certain other tax attributes. The Company has recognized the portion of research and development credits acquired that will not be limited and more likely than not to be realized.Based on the Company’s operating history and management’s expectation regarding future profitability, management believes the Company’s deferred tax assets are more likely than not to be realizable under ASC 740, Income Taxes. Accordingly, no valuation allowance exists as of December 31, 2024, and December 31, 2023.

F-31

Table of Content

Income tax expense (benefit) differed from the amounts computed by applying the federal statutory income tax rate of 21% to pretax income due to the following adjustments (in thousands): December 31,2024December 31,2023Statutory rate$(1,871)$(1,354)State income taxes, net of federal benefit(879)(138)Section 162(m) compensation differences3,499 1,381 Other permanent differences(29)– Meals & entertainment399 267 Employee stock purchase plans319 201 Acquisition-related costs4 112 Stock compensation(3,952)(1,970)Foreign taxes24 24 Other(13)(111)Research & development credit(7,067)(3,098)Uncertain tax positions(2,414)4,863 Provision (benefit) for income tax$(11,980)$177 The adjustment to the statutory rate from state income taxes for the year ended December 31, 2024, and December 31, 2023, respectively, are the result of state and local income