Company: ATRA
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0000950170-25-035507
Chunk: 238

Company: Atara Biotherapeutics, Inc.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 1B
Chunk 238
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 our tax attributes that may be utilized in a given period, should we generate taxable income, we have determined that we will have net operating losses and tax credits that will expire unutilized.  We have reduced our net operating loss carryforwards and tax credit carryforwards in the above table as a result.Beginning January 1, 2022, the Tax Cuts and Jobs Act (the Tax Act) eliminated the option to deduct research and development expenditures in the current year and requires taxpayers to capitalize such expenses pursuant to Internal Revenue Code (IRC) 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 Tax Act, deferred tax assets related to capitalized research expenses pursuant to IRC Section 174 decreased by $11.1 million for the year ended December 31, 2024 and increased by $21.7 million for the year ended December 31,2023, respectively. The current year decrease is a result of more amortization than the amount capitalized in the current year whereas the prior year increase was partially offset by amortization on research expenses capitalized in prior years.Our tax credit carryforwards decreased by $22.4 million, as compared to 2023, due the Section 382 study limiting our ability to utilize attributes as a result of our ownership changes. We regularly evaluate the positive and negative evidence in determining the realizability of our deferred tax assets. Based upon the weight of available evidence, which includes our historical operating performance and reported cumulative net losses since inception, we maintained a full valuation allowance on the net deferred tax assets as of December 31, 2024 and 2023. We intend to maintain a full valuation allowance on our deferred tax assets until sufficient positive evidence exists to support reversal of the valuation allowance. The valuation allowance decreased by $106.6 million for the year ended December 31, 2024 due to the decrease in our net deferred tax assets. The American Rescue Plan Act (ARA) was signed into law on March 11, 2021. We do not expect the ARA to have a material impact on our financial statements, however, given the potential changes to IRC Section 162(m) effective in 2027 as a result of the ARA, we will continue to monitor and assess. No changes have been made to our financial statements as of December 31, 2024.Under the Tax Act, federal NOLs generated in tax years