Company: NEWTP
Filing Date: 2025-05-12
Form Type: 10-Q
Source: 0001587987-25-000084
Chunk: 243

Company: NewtekOne, Inc.
Filing Date: 2025-05-12
Form: 10-Q
Item: Part I, Item 8
Chunk 243
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 year ended December 31, 2022. Beginning with 2023, the Company no longer qualifies as a RIC and instead will file a consolidated U.S. federal income tax return. Financial holding companies are subject to federal and state income taxes in essentially the same manner as other corporations.One of the Company’s wholly owned subsidiaries is undergoing a federal income tax audit for the fiscal year ended December 31, 2022. 

Effective Tax Rate and Net Operating LossesThe effective tax rate was 19.59% for the three months ended March 31, 2025. The effective tax rate differs from the federal tax rate of 21% for the three months ended March 31, 2025, due primarily to the recognition of the difference in basis in the Company’s investment in NTS.At December 31, 2024, the Company has $4.1 million of state net operating loss carryforwards. Of the $4.1 million, $4.0 million is expected to expire at various dates through 2043 with the remainder of the net operating losses having indefinite lives. If substantial changes in the Company’s ownership occur, there would be an annual limitation on the amount of carryforward(s) that can be utilized.The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings. The Company files tax returns in federal and certain state and local jurisdictions. The periods subject to examination are generally for tax years ended in 2020 and beyond, including the following major jurisdictions: U.S. Federal, New York, and Florida. However, the Company’s net operating losses continue to be subject to review by tax authorities in the period utilized notwithstanding origination in closed periods.The Company does not have any material interest and penalties recorded in the income statement for the three months ended March 31, 2025 and 2024.

NOTE 17—SEGMENTS:The Company's management reporting process measures the performance of its operating segments based on internal operating structure, which is subject to change from time to time. The Company's segment reporting process begins with the assignment of all loans directly to the segments where these products are originated and/or serviced. All deposit accounts are allocated to the Banking segment as our wholly owned FDIC insured depository is included within the Banking segment. Equity capital is assigned to each segment based on the risk profile of their assets and liabilities. With the exception of goodwill, which is assigned a 100% weighting, equity capital allocations ranged from