Annual report pursuant to Section 13 and 15(d)

Income Tax

v3.21.1
Income Tax
 7 Months Ended
Dec. 31, 2020
Income Tax Disclosure [Abstract]  
INCOME TAX

NOTE 8. INCOME TAX

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

 

 

 

December 31,

 

 

 

2020

 

Deferred tax assets

 

 

 

 

Start-up Costs

 

$

193,691

 

Net operating loss carryforward

 

 

23,374

 

Total deferred tax assets

 

 

217,065

 

Valuation Allowance

 

 

(217,065

)

Deferred tax assets, net of allowance

 

$

—

 

 

The income tax provision consists of the following:

 

 

 

 

 

 

 

 

For the Period

from

May 29, 2020

(Inception)

Through

December 31,

 

 

 

2020

 

Federal

 

 

 

 

Current

 

$

—

 

Deferred

 

 

(217,065

)

State and Local

 

 

 

 

Current

 

 

—

 

Deferred

 

 

—

 

Change in valuation allowance

 

 

217,065

 

Income tax provision

 

$

—

 

 

As of December 31, 2020, the Company had $111,305 of U.S. federal net operating loss carryovers available to offset future taxable income which have an indefinite life.

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 period from May 29, 2020 (inception) through December 31, 2020, the change in the valuation allowance was $217,065.

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

 

 

 

December 31,

 

 

 

2020

 

Statutory federal income tax rate

 

 

21.0

%

State taxes, net of federal tax benefit

 

 

0.0

%

Valuation allowance

 

 

(21.0

)%

Income tax provision

 

 

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 Virginia to be a significant state tax jurisdiction.