INCOME TAXES

6 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

INCOME TAXES

(8) INCOME TAXES

During the three months ended June 30, 2022, we recorded no income tax benefits for the net operating losses incurred or for the research and development tax credits generated due to the uncertainty of realizing a benefit from those items.

We have evaluated the positive and negative evidence bearing upon the Company’s ability to realize its deferred tax assets, which primarily consist of net operating loss carryforwards and research and development tax credits. We considered the history of cumulative net losses, estimated future taxable income and prudent and feasible tax planning strategies and we have concluded that it is more likely than not that we will not realize the benefits of our deferred tax assets. As a result, as of June 30, 2022 and December 31, 2021, we recorded a full valuation allowance against our net deferred tax assets.

As of June 30, 2022 and December 31, 2021, the Company had federal net operating loss carry forwards of approximately $57.5 million and $62.7 million, respectively, which are available to offset future taxable income. They are due to expire in varying amounts from 2022 to 2040. Federal net operating losses occurring after December 31, 2017, of approximated $19.0 million may be carried forward indefinitely. As of June 30, 2022 and December 31, 2021, the Company had state net operating loss carry forwards of approximately $24.0 million and $19.9 million, respectively, which are available to offset future taxable income. They are due to expire in varying amounts from 2033 through 2040. We recorded minimum state income taxes and taxes related to our operations in Mexico. For the three and six months ended June 30, 2022 and 2021, income tax expense was $51 thousand and $31 thousand, respectively, compared to prior year periods of $57 thousand and $33 thousand, respectively.