Company: IIIV
Filing Date: 2025-11-21
Form Type: 10-K
Source: 0001728688-25-000122
Chunk: 106

Company: i3 Verticals, Inc.
Filing Date: 2025-11-21
Form: 10-K
Item: Item 7
Chunk 106
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3 reflects $0.9 million relating to adjustments of liabilities under our Tax Receivable Agreement related to the remeasurement of the underlying deferred tax asset for changes in estimated income tax rates and $0.3 million contingent consideration received for an investment that was sold in a prior year.

60

Benefit from Income Taxes

The benefit from income taxes increased $2.0 million to $5.5 million for the year ended September 30, 2024 as compared to $3.5 million for the year ended September 30, 2023. Our effective tax rate of 25% for the year ended September 30, 2024 differs from the federal statutory rate of 21% primarily due to the tax structure of the Company, valuation allowance activity and state tax expense. The income of majority-owned i3 Verticals, LLC is not taxed at the entity-level. i3 Verticals, Inc. is subject to federal, state and local income taxes with respect to its allocable share of any taxable income of i3 Verticals, LLC and is taxed at the prevailing corporate tax rates.

Net income from discontinued operations, net of income taxes

We had $191.2 million in net income from discontinued operations, net of income tax, for the year ended September 30, 2024 from $22.2 million for the year ended September 30, 2023. See Note 2 to our consolidated financial statements for additional information and detail on the financial results of discontinued operations.

The net income from discontinued operations, net of income tax, for the year ended September 30, 2024 included the gain on the sale of the Merchant Services business of $205.6 million, partially offset by the provision for income taxes of $41.1 million. Both the years ended September 30, 2024 and 2023 included a complete year of business activity for both the Merchant Services Business and the Healthcare RCM Business. The year ended September 30, 2024 included revenue of $185.0 million and operating expenses of $158.3 million. The net income from discontinued operations, net of income tax, for the year ended September 30, 2023 included revenue of $180.6 million, operating expenses of $153.4 million and a provision for income taxes of $2.3 million.

Seasonality

We have experienced in the past, and may continue to experience, seasonal fluctuations in our revenues as a result of consumer and business spending patterns. The number of business