Company: AIRJW
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001013762-25-002263
Chunk: 1264

Company: AirJoule Technologies Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 7A
Chunk 1264
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     20,828,950 
  
    Total income tax expense 
    $81,256,047 

F-31

Deferred
income taxes reflect the net tax effects of temporary differences between the carrying value of assets and liabilities for financial
reporting purposes and amounts used for income tax purposes. The temporary differences that give rise to deferred tax assets and liabilities
are as follows:

    Year
    Ended December 31, 2024 
  
    Deferred
    tax assets 

    Net
    operating losses 
    $2,894,110 
  
    Share-based
    compensation and other accrued expenses 
     621,958 
  
    Start-up
    costs 
     778,644 
  
    Capitalized
    R&D expense 
     1,287,402 
  
    Lease
    liabilities 
     40,611 
  
    Total
    deferred tax asset 
     5,622,725 

    Deferred
    tax liabilities 

    Outside
    basis in joint venture 
     86,839,767 
  
    Right-of-use
    asset 
     38,709 
  
    Other 
     296 
  
    Total
    deferred tax liability 
     86,878,772 
  
    Net
    deferred tax liabilities 
    $81,256,047 

As
of December 31, 2024, the Company has generated federal net operating losses of $11.0 million and state net operating losses of $11.0
million. The federal and state net operating loss carryforwards generated in tax year 2024 will never expire. Utilization of the net
operating loss carryforwards may be subject to an annual limitation according to Section 382 of the Internal Revenue Code of 1986
as amended, and similar provisions.

ASC
740 requires a valuation allowance to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more likely
than not that some portion or all of the deferred tax assets will not be realized. After consideration of all of the evidence, the Company
has not recorded a valuation allowance against its deferred tax assets at December 31, 2024 because management has determined that it
is more likely than not that the Company recognize the benefits of its federal and state deferred tax assets.

The
Company recognizes interest accrued to unrecognized tax benefits and penalties as income tax expense. The Company accrued total penalties
and interest of $0 during