Annual report pursuant to Section 13 and 15(d)

INCOME TAXES

v3.24.1
INCOME TAXES
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
INCOME TAXES

11. INCOME TAXES

 

The Company is subject to U.S. federal and various state income taxes.

 

The income tax provision (benefit) for the years ended December 31, 2023, 2022 and 2021 consisted of the following:

 

    For the Year Ended  
    December 31,  
    2023     2022     2021  
Federal:                        
Current   $ -     $ -     $ -  
Deferred   $ (7,129 )  

$

 (22,605 )  

$

 (5,691 )
                         
State:                        
Current   $ -    

$

 -     $ -  
Deferred   $ 426     $ (1,430 )  

$

 (1,348 )
                         
Foreign:                        
Current  

$

 1,493    

$

 317    

$

 -  
Deferred  

$

 (7,995 )   $ (4,120 )  

$

 -  
   

$

 (13,205 )  

$

 (27,837 )  

$

 (7,039 )
Change in valuation allowance   $ 14,699    

$

 28,145    

$

 7,039  
Income tax provision (benefit)   $

1,494

     $ 308     $ -  

 

No federal or state current tax provision has been recorded for the years ended December 31, 2023, 2022, and 2021 because the Company had net operating losses for federal and state tax purposes. However, a foreign tax provision was recorded related to the Company’s operations in India. The net operating loss carryovers may be subject to annual limitations under Internal Revenue Code Section 382, and similar state provisions, should there be a greater than 50% ownership change as determined under the applicable income tax regulations. The amount of the limitation would be determined based on the value of the company immediately prior to the ownership change and subsequent ownership changes could further impact the amount of the annual limitation. An ownership change pursuant to Section 382 may have occurred in the past or could happen in the future, such that the NOLs available for utilization could be significantly limited. The Company will perform a Section 382 analysis in the future. The related decrease in the deferred tax asset will be offset by the decrease in valuation allowance.

 

 

BLINK CHARGING CO.

 

Notes to Consolidated Financial Statements

(in thousands, except for share and per share amounts)

 

11. INCOME TAXES – CONTINUED

 

A reconciliation of the statutory federal income tax rate to the Company’s effective tax rate is as follows:

 

                         
    For the Year Ended  
    December 31,  
    2023     2022     2021  
Tax benefit at federal statutory rate     (21.0 )%     (21.0 )%     (21.0 )%
State income taxes, net of federal benefit     0.2 %     (1.3 )%     (2.4 )%
Permanent differences:                        
Stock Compensation     1.5 %     0.6 %     0.2 %
Loss on Impairment of Intangibles and Goodwill     9.8 %     0.0 %     0.0 %
Section 162(m)     1.9 %     1.7 %     8.3 %
Other Permanent Differences    

0.2

 %     0.7 %     (0.3 )%
Tax credits     0.0 %     0.0 %     (0.1 )%
Income from non-includable foreign entities    

1.8

 %     4.3 %     1.6 %
Prior year differences     2.3 %     (11.2 )%     1.0 %
Change in valuation allowance    

7.3

 %     30.8 %     12.8 %
Foreign tax    

(3.2

 )%     (4.2 )%     0.0 %
Effective income tax rate     0.7 %     0.3 %     0.0 %

 

The Company has determined that a valuation allowance for the entire net deferred tax asset is required. A valuation allowance is required if, based on the weight of evidence, it is more likely than not that some or the entire portion of the deferred tax asset will not be realized. After consideration of all the evidence, both positive and negative, management has determined that a full valuation allowance is necessary to reduce the deferred tax asset to zero, the amount that will more likely not be realized.

 

The disaggregation of the Company’s domestic and foreign pre-tax loss for the years ended December 31, 2023, 2022, and 2021 is as follows:

 

                         
    For the Year Ended December 31  
    2023     2022     2021  
U.S.   $ (151,883 )   $ (76,528 )   $ (50,803 )
Foreign     (50,315 )     (14,724 )     (4,316 )
Total   $ (202,199 )   $ (91,252 )   $ (55,119 )

 

 

BLINK CHARGING CO.

 

Notes to Consolidated Financial Statements

(in thousands, except for share and per share amounts)

 

11. INCOME TAXES – CONTINUED

 

The tax effects of temporary differences that give rise to deferred tax assets and liabilities are presented below:

 

                 
    December 31  
    2023     2022  
Deferred Tax Assets:                
Net operating loss carryforwards-federal   $ 64,076     $ 51,722  
Net operating loss carryforwards-states    

9,837

       8,392  
Net operating loss carryforwards-UK    

4,759

       2,584  
Net operating loss carryforwards-Belgium    

8,454

       3,022  
Tax credits    

656

       626  
Stock-based compensation     1,542       5,137  
Accruals    

513

       1,425  
Deferred revenue    

2,052

       441  
Allowance for doubtful accounts    

1,180

       441  
Goodwill    

714

       712  
Capitalized Sec.174 R&E    

1,154

       297  
Other    

633

       522  
Deferred tax assets, gross    

95,569

       75,321  
Deferred Tax Liabilities:                
Intangible Assets     (3,743 )     (5,791 )
Fixed Assets    

(2,226

 )     (488 )
Unrealized Gain/Loss     (80 )     (134 )
Deferred Tax assets reserves     -       (370 )
Other     (81)       (123 )
Deferred tax liabilities, gross     (6,129 )     (6,905 )
                 
Net deferred tax assets     89,440       68,416  
Valuation Allowance     (89,414 )     (68,390 )
Deferred tax assets, net of valuation allowance     26       27  
                 
Change in valuation allowance   $ 21,024     $ 33,122

 

As of December 31, 2023, the Company had net operating loss carry forwards for federal income tax purposes of approximately $305,125 of which, $86,636 may be used to offset future taxable income through 2037 and the remaining $218,489 of net operating loss carry forwards incurred after 2017, do not have an expiration date. In addition, state NOLs carryforwards available are approximately $212,571, as of December 31, 2023.The Company also has approximately $653 in business credits expiring between 2030 and 2043.

 

 

BLINK CHARGING CO.

 

Notes to Consolidated Financial Statements

(in thousands, except for share and per share amounts)