What was the net deferred tax assets (liabilities) for My Salon Suite in 2023?

According to My Salon Suite's 2025 Franchise Disclosure Document, the net deferred tax assets (liabilities) in 2023 were $(17,220,366). This figure represents the difference between the company's total deferred tax assets and its total deferred tax liabilities for that year. Deferred tax assets arise when taxable income is expected to be higher in the future, while deferred tax liabilities arise when taxable income is expected to be lower in the future.

Specifically, in 2023, My Salon Suite had total deferred tax assets of $1,691,954 and total deferred tax liabilities of $(18,912,320). The deferred tax assets included items such as allowance for credit losses ($259,270), accrued compensation ($105,770), share-based compensation ($653,599), accrued professional fees ($34,418), deferred revenue ($860,544), ASC 842 lease liability ($3,309), and ASC 606 adjustments ($(224,956)). The deferred tax liabilities primarily consisted of intangible assets ($(18,689,307)), prepaid expenses ($9,702), ASC 842 Right of Use Asset ($(4,487)), depreciation ($(90,514)), and tax amortization of Sec.174 ($(137,714)).

The net deferred tax liability indicates that My Salon Suite had a greater amount of future tax obligations than future tax benefits based on temporary differences between the book and tax values of its assets and liabilities. This information is crucial for prospective franchisees as it provides insight into the company's financial health and tax planning strategies. Understanding these deferred tax positions can help franchisees assess the potential impact of taxes on the overall profitability and financial stability of My Salon Suite.