What was the amount of Checkersrallys' net deferred tax assets as of January 1, 2024?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
40, Income Taxes, the tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and liabilities recognized within "deferred income tax liabilities" in the accompanying consolidated balance sheets as of January 1, 2024 (Successor) and January 2, 2023 (Predecessor) were as follows:
| For the Periods Ended | |||||
|---|---|---|---|---|---|
| nuary 1, 2024 (ccessor) | January 2, 2023 (Predecessor | ||||
| Deferred tax assets: | |||||
| Net operating loss carryforwards | $ | ~ | $ | 13,890 | |
| Business interest limitation carryforward | 21,518 | 15,579 | |||
| Accruals | 2,211 | 1,757 | |||
| Operating right-of-use assets | 39,355 | 53,837 | |||
| Difference between book and tax basis of property and equipment | 9,423 | 34 | |||
| Allowance for credit losses | 69 | 94 | |||
| St |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys' 2025 Franchise Disclosure Document, the company's net deferred tax assets as of January 1, 2024, totaled $36,827. This figure is derived from deferred tax assets of $75,115, less a valuation allowance of $38,288.
Deferred tax assets arise from temporary differences between the book value of assets and liabilities and their tax bases, as well as from net operating loss carryforwards and tax credit carryforwards. These assets represent future tax benefits that Checkersrallys expects to realize. The valuation allowance reduces the deferred tax assets to the amount that is more likely than not to be realized.
For a prospective Checkersrallys franchisee, understanding these figures is crucial for assessing the financial health and tax planning strategies of the company. While franchisees do not directly share in these deferred tax assets, the overall financial stability of the franchisor can impact the support and resources available to franchisees. A strong financial position for Checkersrallys suggests a greater capacity to invest in brand development, marketing, and franchisee support programs.
It's important to note that deferred tax assets are subject to change based on future earnings, tax law changes, and other factors. Franchisees should consult with their own financial advisors to understand the implications of these figures and how they relate to their individual business circumstances.