Income Taxes

9 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company recorded income tax expense of $0 for the three and nine months ended September 30, 2024, as compared to income tax expense of $135 and $278 for the three and nine months ended September 30, 2023, respectively. The decrease of

$278, in income tax expense is primarily related to the corresponding change in the valuation allowance for TOI. The Company's effective tax rate increased to 0.00% for the nine months ended September 30, 2024, from (0.43)% for the nine months ended September 30, 2023.

The Company's effective tax rate for the three and nine months ended September 30, 2024 was different than the U.S. federal statutory tax rate of 21.00%, primarily due to the change in the valuation allowance, partially offset by non-deductible expenses, as well as the Section 162(m) limitation on compensation for covered employees, and Section 163(l) limitation on interest expense related to the convertible note, all of which are non-taxable for federal income tax purposes.