Company: DAWN
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0000950170-25-026654
Chunk: 56

Company: Day One Biopharmaceuticals, Inc.
Filing Date: 2025-02-25
Form: 10-K
Item: Item 16
Chunk 56
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61.1 million, $40.6 million, and $30.0 million for the years ended December 31, 2024, 2023, and 2022, respectively.As of December 31, 2024, the Company had federal net operating loss carryforwards, or NOLs, of $93.6 million that do not expire and federal tax credits of $25.3 million available to offset tax liabilities that begin to expire in 2038. The Company also has gross state NOLs of $169.6 million and state tax credits of $2.9 million which are available to offset state tax liabilities. The state NOLs begin to expire in 2038 and the state tax credits do not expire.

F-34

During the year ended December 31, 2024, the Company completed a Section 382 study to determine whether an ownership change per the provisions of Section 382 of the Internal Revenue Code, as well as similar state provisions, has occurred. The Company’s current year utilization of net operating losses and income tax credits is not impacted by the provisions of Section 382 or 383. Utilization of its net operating loss and income tax credit carryforwards may be subject to an annual limitation due to ownership changes that may have occurred or that could occur in the future. These ownership changes may limit the amount of the net operating loss and income tax credit carryover that can be utilized annually to offset future taxable income. In general, an “ownership change” as defined by Section 382 of the Internal Revenue Code results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding shares of a company by certain stockholders.In accordance with the Tax Cuts and Jobs Act of 2017, Research and Experimental, or R&E, expenses under Internal Revenue Code Section 174 are required to be capitalized beginning in 2022. R&E expenses are required to be amortized over a period of 5 years for domestic expenses and 15 years for foreign expenses.
Uncertain Tax PositionsIn accordance with authoritative guidance, the impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained.The following table reconciles the beginning and ending amount of unrecognized tax benefits (in thousands