Company: BKYI
Filing Date: 2025-04-23
Form Type: 10-K
Source: 0001437749-25-012824
Chunk: 430

Company: BIO KEY INTERNATIONAL INC
Filing Date: 2025-04-23
Form: 10-K
Item: Item 8
Chunk 430
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 expense (benefit)  $(22,998) $(134,014)

   Significant components of deferred tax assets and liabilities are as follows at  December 31, 2024 and 2023 :

       December 31,    December 31,  
   2024    2023  
         
 Accrued compensation  $154,457  $112,201 
 Allowance for doubtful accounts   20,513   90,405 
 Research and development expenses   1,216,601   1,017,551 
 Capital loss carry forward   114,251   114,251 
 Stock-based compensation   34,299   32,408 
 Equipment and leasehold improvements   (6,268)  (12,353)
 Intangible assets - US   -   - 
 Intangible assets - Foreign   -   (145,000)
 Reserve - Foreign   -   150,000 
 Inventory reserve   781,213   828,668 
 Interest expense   -   - 
 Operating lease liabilities   (16,346)  - 
 Other   1,000   1,000 
 Tax credits   1,554,541   1,748,235 
 Operating lease right-of-use assets   16,406   206 
 Net operating loss and research and credit carryforwards   11,824,622   13,277,118 
 Valuation allowance   (15,740,289)  (17,214,690)
         
 Net deferred tax liability  $-  $ 

   The Company has a valuation allowance against the full amount of its net deferred taxes due to the uncertainty of realization of the deferred tax assets due to operating loss history of the Company. The Company currently provides a valuation allowance against deferred taxes when it is more likely than not that some portion, or all of its deferred tax assets will not be realized. The valuation allowance could be reduced or eliminated based on future earnings and future estimates of taxable income. With a full valuation allowance, any change in the deferred tax asset or liability is fully offset by a corresponding change in the valuation allowance. At  December 31, 2024 and 2023, the Company provided a valuation allowance on its net deferred tax assets of $15,740,289 and $17,214,690 respectively.

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