Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

15. Income Taxes

The Company’s effective income tax rate differs from the federal statutory rate primarily as a result of state taxes, certain expenses being deductible for financial reporting purposes that are not deductible for tax purposes, goodwill impairment and a full valuation allowance recorded on net deferred tax assets.

The difference in the provision for income taxes and the amount computed by applying the statutory federal income tax rates consists of the following:

	Year December 31, 2021			April 7, 2020 through December 31, 2020
	Successor			Successor
Statutory tax rate		21.0	%		21.0	%
State income taxes, net of federal benefit		2.3	%		2.4	%
Permanent differences		0.1	%		-0.2	%
Goodwill impairment		0.0	%		0.0	%
Return to Provision		0.9	%		0.0	%
Change in valuation allowance		-18.9	%		-19.3	%
State tax differences from blended rates		0.0	%		0.0	%
Warrants		-5.4	%		-3.9	%
Other differences		0.0	%		0.0	%
Provision		0.0	%		0.0	%

Principal components of the Company’s deferred tax assets were as follows: 

	December 31, 2021			December 31, 2020
Prepaid expenses	$	(530	)	$	(104	)
Accrued reserves		70			27
Deferred revenue		15			39
Accrued liabilities		1,428			438
Uniform capitalization of inventory for tax		148			34
Contribution carryover		13			13
Tax depreciation in excess of book		(564	)		(1,137	)
Intangible assets		5,057			(2,807	)
Transaction costs		817			-
Disallowed interest		5,017			1,410
Stock compensation		2,113			597
Net operating loss carryforwards		17,402			6,098
Total		30,986			4,608
Less: valuation allowance		(30,986	)		(8,067	)
Net deferred tax liability	$	-		$	(3,459	)

At December 31, 2021, the Company had net operating loss carryforwards of approximately $73,288. Of this amount, $1,117 expires in 2036, while the remaining amounts have an indefinite carryforward period but are subject to a limitation of 80% of taxable income each year. The Company also had state net operating loss carryforwards of approximately $28,605 with various expiration periods beginning in 2029.

The Company files a federal income tax return and separate income tax returns in various states. For federal and certain states, the 2018 through 2020 tax years remain open for examination by the tax authorities under the normal three-year statute of limitations.

The Company assesses available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant component of objective negative evidence identified during management’s evaluation was the cumulative loss incurred over the three-year period ended December 31, 2021. Such objective evidence limits the ability to consider other subjective evidence, such as our forecasts of future taxable income and tax planning strategies. On the basis of this evaluation as of December 31, 2021, the Company recognized a full valuation allowance against its net deferred tax assets, pursuant to ASC 740, as of December 31, 2021. Based on the Company’s evaluation, it was determined that no uncertain tax positions existed as of December 31, 2021 or December 31, 2020.