Income Tax

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

INCOME TAX

NOTE 9. INCOME TAX

The Company’s net deferred tax assets are as follows:

Description	December 31, 2022			December 31, 2021
Deferred tax assets
Net operating loss carryforward	$	—		$	57,440
Startup and organizational expenses		753,230			322,752
Total deferred tax assets		753,230			380,192
Valuation Allowance		(753,230	)		(380,192	)
Deferred tax assets, net of allowance	$	—		$	—

The income tax provision consists of the following:

Description	December 31, 2022			December 31, 2021
Federal
Current		41,592		—
Deferred		(243,908	)		(380,192	)
State and Local
Current		10,893		—
Deferred		(129,130	)	—
Change in valuation allowance		373,038			380,192
Income tax provision	$	52,485		$	—

As of December 31, 2022 and December 31, 2021, the Company had $0, and $273,522 of U.S. federal net operating loss carryovers, which do not expire, available to offset future taxable income, respectively.

In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the years ended December 31, 2022 and 2021, the change in the valuation allowance was $373,038 and $380,192, respectively.

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

Description	December 31, 2022				December 31, 2021
Statutory federal income tax rate		21.0		%		21.0		%
State taxes, net of federal tax benefit		20.39		%		-		%
Merger costs		(358.38	)	%		-		%
Change in fair value of warrants		331.68		%		(21.1	)	%
Change in fair value of forward purchase agreement liability		21.32		%		(1.7	)	%
Deferred underwriting fees		18.23		%		-		%
Valuation allowance		(63.11	)	%		1.8		%
Income tax provision		(8.87	)	%		(0.0	)	%

The Company files income tax returns in the U.S. federal jurisdiction and is subject to examination by the various taxing authorities. The Company's tax returns since inception remain open to examination by the taxing authorities. The Company considers Florida to be a significant state tax jurisdiction.