Greenlane Holdings, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2023

SCHEDULE OF INCOME BEFORE INCOME TAX, DOMESTIC AND FOREIGN

The Company’s United States and foreign operations components of income (loss) from continuing operations before income taxes are as follows:


	For the year ended December 31,
(in thousands)	2023			2022
United States	$	(30,325	)	$	(172,997	)
Foreign	$	(2,000	)	$	(9,242	)
Total	$	(32,325	)	$	(182,239	)

SCHEDULE OF COMPONENTS OF INCOME TAX EXPENSE (BENEFIT)

The income tax (benefit) expense for the years ended December 31, 2023 and 2022 consisted of the following:

(in thousands)	Federal			Foreign			State			Total			Federal			Foreign			State			Total
	For the year ended December 31, 2023												For the year ended December 31, 2022
(in thousands)	Federal			Foreign			State			Total			Federal			Foreign			State			Total
Current tax (benefit) expense
Current year	$	—		$	—		$	—		$	—		$	—		$	(13	)	$	—		$	(13	)
Total current year		—			—			—			—			—			(13	)		—			(13	)
Deferred tax (benefit) expense
Current year		(5,991	)		(500	)		(1,798	)		(8,289	)		(31,475	)		(2,311	)		(10,368	)		(44,154	)
Change in valuation allowance		5,743			500			1,219			7,462			36,867			2,311			13,523			52,701
Change in tax rate		—			—			780			780			72			—			(344	)		(272	)
Tax conversion of Operating Company		—			—			—			—			2,990			—			1,022			4,012
Up-C consolidation		—			—			—			—			(10,097	)		—			(3,440	)		(13,537	)
KushCo merger or true ups		248			—			(201	)		47			1,643			—			(393	)		1,250
Total deferred tax (benefit) expense		—			—			—			—			—			—			—			—
Income tax (benefit) expense	$	—		$	—		$	—		$	—		$	—		$	(13	)	$	—		$	(13	)

SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION

A reconciliation of the income tax (benefit) expense computed at the U.S. federal statutory income tax rate to the income tax expense recognized is as follows:


	For the year ended December 31,
(in thousands)	2023			2022
Expected federal income tax (benefit) expense at statutory rate	$	(6,788	)	$	(38,270	)
State tax expense, net of federal benefit		(1,605	)		(8,688	)
Loss attributable to non-controlling interests		4			2,121
Change in valuation allowance		7,462			52,701
Tax conversion of Operating Company		—			4,012
Up-C consolidation		—			(13,537	)
KushCo merger		—			1,250
Change in tax rates					—
Prior year true-ups		227			—
Other, net		700			398
Income tax (benefit) expense	$	—		$	(13	)

SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

The components of deferred tax assets and liabilities were as follows:


	As of December 31,
(in thousands)	2023			2022
Deferred tax assets:
Goodwill and other intangible assets	$	36,018		$	36,841
Fixed assets		943			1,590
Inventory		2,854			5,858
Allowance for doubtful accounts		833			833
Operating lease liability		164			862
Equity-based compensation		2,576			2,576
Business interest carryforward		6,897			5,342
Net operating loss carryforwards		67,667			57,136
Other		411			576
Total deferred tax assets		118,363			111,614
Valuation allowance		(118,262	)		(110,799	)
Net deferred tax assets		101			815
Deferred tax liability:
Right of use assets		(101	)		(815	)
Basis difference in investment in the Operating Company		—			—
Total deferred tax liabilities		(101	)		(815	)
Net deferred tax assets and liabilities	$	—		$	—