INCOME TAX

6 Months Ended

Jun. 30, 2021

INCOME TAX [Abstract]

INCOME TAX

NOTE 10. INCOME TAX

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

	June 30, 2021			December 31, 2020
Deferred tax asset
Net operating loss carryforward	$	10,920		$	10,861
Change in fair value of warrants		(380,100	)		—
Organizational costs/Startup expenses		1,115,645			78,848
Total deferred tax asset		746,465			89,709
Valuation allowance		(746,465	)		(89,709	)
Deferred tax asset, net of allowance	$	—		$	—

The income tax provision consists of the following:

	June 30, 2021			December 31, 2020
Federal
Current	$	—		$	—
Deferred		(746,465	)		(89,709	)
State
Current	$	—		$	—
Deferred		—			—
Change in valuation allowance		746,465			89,709
Income tax provision	$	—		$	—

As of June 30, 2021, the Company had a U.S. federal net operating loss carryover of approximately $52,000 available to offset future taxable income.

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 three months and six months ended June 30, 2021, the change in the valuation allowance was $746,465 and $1,082,267, respectively.

A reconciliation of the federal income tax rate to the Company’s effective tax rate at June 30, 2021 is as follows:

Statutory federal income tax rate	21.0	%
State taxes, net of federal tax benefit	0.0	%
Change in fair value of warrant liability	10.7	%
Change in valuation allowance	-31.7	%
Income tax provision	0.0	%