Company: BWMN
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001628280-25-023232
Chunk: 83

Company: Bowman Consulting Group Ltd.
Filing Date: 2025-05-07
Form: 10-Q
Item: Part I, Item 8
Chunk 83
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 effective tax rate is predominantly due to certain non-recurring discrete events in addition to changes in the estimated annual effective tax rate, as discussed below. The most prominent factors impacting the estimated annual effective tax rate include a decrease in the projected limitation of the deductible executive compensation for 2025, an increase in projected R&D credits generated for 2025, and an overall increase in forecasted income for 2025 relative to 2024. Further, the Company also recognized a net discrete expense of $0.9 million for the three months ended March 31, 2025, compared to a net discrete benefit of $1.2 million for the three months ended March 31, 2024. The net discrete expense is predominantly the result of absence of a windfall tax benefit for restricted stock awards, penalties and interest recorded for uncertain tax positions, and other non-recurring adjustments. More specifically, the shortfall tax adjustment for restricted stock awards recognized at a value lower than the grant date fair value is $0.1 million for the three months ended March 31, 2025 compared to a windfall tax adjustment of $2.5 million for restricted stock awards recognized at a value higher than the grant date fair value for the three months ended March 31, 2024. Penalties and interest accrued for uncertain tax positions are $0.6 million for the three months 

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ended March 31, 2025, and $1.3 million for the three months ended March 31, 2024. These factors reduced the rate by 91.3% for the three months ended March 31, 2025, and increased the rate by 24.2% for the three months ended March 31, 2024.The Company files income tax returns in the U.S. federal jurisdiction and certain states in which it operates. Based on the timing of the filing of certain tax returns, the Company’s federal income tax returns for tax years 2021 and thereafter remain subject to examination by the U.S. Internal Revenue Service. The statute of limitations on the Company’s state income tax returns generally conforms to the federal three-year statute of limitations.SegmentsThe Company operates in one segment based upon the financial information used by its chief operating decision maker in evaluating the financial performance of its business and allocating resources. The single segment represents the Company’s core business of providing engineering and related professional services to its customers. See Note 16 Segment Information for further information on the Company's report