|3 Months Ended|
Mar. 31, 2021
|Income Tax Disclosure [Abstract]|
14. Income Taxes
The Company is a corporation subject to federal income tax at a statutory rate of 21%
of pretax earnings, and state income taxes at a blended statutory rate of 3.8% net of federal benefit. The Company has an annual effective income tax rate of
under ASC 740-270-30-36(a) due to a full valuation allowance.
At March 31, 2021, based
on the facts and circumstances in accordance with the guidance of ASC 740, management determined, based on its assessment of positive and negative evidence, both objective and subjective, that it is more likely than not that the Company will not realize its deferred tax assets. Therefore, at March 31, 2021, a full valuation allowance of
million was recorded against the Company’s net deferred tax assets, including $0.7 million related to net deferred tax assets as of December 31, 2020.
The net tax expense for the three months ended March 31, 2021 was$0.7
million, resulting in an effective tax rate of approximately
%. The primary difference from the federal statutory rate of21%
is related to the valuation allowance.
Prior to the Business Combination, the Predecessor had elected to be taxed as a partnership under the provisions of the Internal Revenue Code and similar state provisions. Therefore, there was no income tax recorded by the Company for the comparable Predecessor period from January 1, 2020 to March 31, 2020.
The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef