Income taxes

9 Months Ended

Sep. 30, 2025

Income taxes

Income taxes

8. Income taxes

Income tax expense of $95,000 was recorded for the three months ended September 30, 2025 compared to $590,000 for the three months ended September 30, 2024. The effective tax rate was approximately 21.7% for the three months ended September 30, 2025 compared to 31.8% for the three months ended September 30, 2024. An income tax benefit of $105,000 was recorded for the nine months ended September 30, 2025 compared to income tax expense of $965,000 for the nine months ended September 30, 2024. The effective tax rate was approximately 9.7% for the nine months ended September 30, 2025 compared to 30.6% for the nine months ended September 30, 2024. The change in the effective tax rate was attributable to the effect of state income tax expense. Income tax provisions for interim (quarterly) periods are based on estimated annual income tax rates and are adjusted for the effects of significant, infrequent or unusual items (i.e. discrete items) occurring during the interim period.

On July 4, 2025, new tax law was signed, providing permanent extension for several business tax provisions originally enacted under the Tax Law and Jobs Act. The Company does not anticipate the change in tax law to have a material impact on its financial statements. The Company will continue to monitor federal and state-level guidance, including state conformity to these federal tax changes, as further legislative and administrative updates become available.