Company: HFFG
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001680873-25-000074
Chunk: 19

Company: HF Foods Group Inc.
Filing Date: 2025-11-10
Form: 10-Q
Item: Item 1
Chunk 19
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 state jurisdictions based on enacted tax law, permanent differences between book and tax items, tax credits and the Company’s change in relative income in each jurisdiction. Changes in tax laws and rates may affect recorded deferred tax assets and liabilities and the Company’s effective income tax rate in the future. As of September 30, 2025, the Company had one subsidiary outside the U.S. that generated an insignificant amount of activity. As such, no foreign income tax was recorded.

13

For the three and nine months ended September 30, 2025, the Company’s effective income tax rate of 46.5% and 38.2%, respectively, differed from the federal statutory tax rate primarily as a result of permanent differences and state income taxes, partially offset by tax credits. The Company’s tax provision for the three and nine months ended September 30, 2025 includes a discrete tax expense of $1,900 and $2,500 related to stock-based compensation shortfalls. For the three and nine months ended September 30, 2024, the Company’s effective income tax rate of 24.6% and (4.1)%, respectively, differed from the federal statutory tax rate primarily as a result of permanent differences and state income taxes. The Company’s tax provision for the nine months ended September 30, 2024 included a discrete tax expense of $1.0 million related to the Company’s SEC settlement. Additionally, the Company’s tax provision for the three and nine months ended September 30, 2024 included a discrete tax expense of $0.1 million and $0.2 million, respectively, related to stock-based compensation shortfalls.On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The Company evaluated the impact of the OBBBA in the third quarter of 2025, the period of enactment, and determined the impact was not material to the Company’s tax provision as of September 30, 2025. The Company will continue to evaluate the impact of the new legislation on its year-end consolidated financial statements but does not expect the OBBBA to