Company: GURE
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001193805-25-001184
Chunk: 35

Company: GULF RESOURCES, INC.
Filing Date: 2025-08-13
Form: 10-Q
Item: Item 1
Chunk 35
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    Total Income tax benefits 
    $—  
    $(1,208,110) 
    $—  
    $(2,478,170)

Significant components of the Company’s
deferred tax assets and liabilities at June 30, 2025 and December 31, 2024 are as follows:

Income Taxes - Schedule of Deferred
Tax Assets and Liabilities

    June 30, 
    December 31,

    2025 
    2024
  
    Deferred tax liabilities 
    $—  
    $— 

    Deferred tax assets: 

    Exploration costs 
     1,739,141  
     1,731,920 
  
    Allowance 
     421,291  
     729,731 
  
    Impairment of property plant and equipment 
     1,693,125  
     1,686,095 
  
    PRC tax losses 
     10,696,174  
     9,125,871 
  
    US federal net operating loss 
     1,737,880  
     1,661,464 
  
    Total deferred tax assets 
     16,287,611  
     14,935,081 
  
    Valuation allowance 
     (16,287,611) 
     (14,935,081)
  
    Net deferred tax asset 
    $—  
    $— 

Deferred tax assets consist of future reversals of existing taxable
temporary differences and adequate future taxable income, exclusive of reversing deductible temporary differences. As of June 30, 2025
and 2024, valuation allowances were mainly provided against deferred tax assets caused by exploration costs and net operating loss where
it was determined it was more likely than not that the benefits of the deferred tax assets will not be realized due to their continuous
losses.

The increase in valuation allowance for the three-month
period ended June 30, 2025 is $268,713.

The decrease in valuation allowance for the three-month
period ended June 30, 2024 is $42,555.

The increase in valuation allowance for the six-month
period ended June 30, 2025 is $1,352,530.

The decrease in valuation allowance for the six-month
period ended June 30, 2024 is $57,028.

There were no unrecognized tax benefits and accrual
for uncertain tax positions