Company: CIMO
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001628280-25-006426
Chunk: 261

Company: CHIMERA INVESTMENT CORP
Filing Date: 2025-02-19
Form: 10-K
Item: Item 1A
Chunk 261
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 federal, state, and local taxes. The Company recorded current income tax expense of $49 thousand and $102 thousand for the years ended December 31, 2024 and 2023, respectively. The Company had gross deferred tax assets of $111 million and $107 million for the years ended December 31, 2024 and 2023, respectively, relating to the activities of its TRSs. Of these amounts, the amount related to cumulative net operating losses (“NOLs”) was $107 million and $105 million as of December 31, 2024 and 2023, respectively. The amount related to interest disallowed under Code Section 163(j) was $4 million and $2 million as of December 31, 2024 and 2023, respectively. The aforementioned NOLs and interest disallowed under Code Section 163(j) are subject to an indefinite carryforward period to the extent not utilized. The Company evaluates, based on both positive and negative evidence, 

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the likelihood of realizing its deferred tax assets and established a valuation allowance of $111 million and $107 million for the years ended December 31, 2024 and 2023, respectively.The Company’s effective tax rate differs from the U.S. federal corporate statutory tax rate of 21% primarily due to the deduction of dividend distributions required to be paid under Code Section 857(a).The Company’s U.S. federal, state and local tax returns for the tax years ending on or after December 31, 2021, remain open for examination.

15. Credit Risk and Interest Rate Risk

The Company’s primary components of market risk are credit risk and interest rate risk. The Company is subject to interest rate risk in connection with its investments in Agency MBS and Non-Agency RMBS, residential mortgage loans, borrowings under secured financing agreements and securitized debt. When the Company assumes interest rate risk, it attempts to minimize interest rate risk through asset selection, hedging and matching the income earned on mortgage assets with the cost of related financing.The Company attempts to minimize credit risk through due diligence, asset selection and portfolio monitoring. The Company has established a whole loan target market including qualified mortgages, non-qualified mortgages and reperforming residential mortgage loans. Additionally, the Company seeks to minimize credit risk through compliance with regulatory requirements, geographic diversification, owner occupied property, and moderate loan-to-value ratios. These factors are considered to be important indicators