Income Taxes (Tables)
|
12 Months Ended |
Dec. 31, 2023 |
Income Tax Disclosure [Abstract] |
|
Schedule of Differences Reclassified for Tax Purposes |
The following differences were reclassified for tax purposes for the years ended December 31, 2023 and December 31, 20221:
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
2022 |
|
Increase (decrease) in capital in excess of par value |
|
$ |
4,336,903 |
|
|
$ |
(215,542 |
) |
(Decrease) increase in total distributable earnings |
|
|
(4,336,903 |
) |
|
|
215,542 |
|
|
Schedule of Reconciliation of Net Increase in Net Assets Resulting From Operations to Taxable Income |
The following table reconciles net increase in net assets resulting from operations to taxable income for the years ended December 31, 2023 and December 31, 2022:
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
2022 |
|
Net increase (decrease) in net assets resulting from operations |
|
$ |
6,526,650 |
|
|
$ |
(881,849 |
) |
Net change in unrealized appreciation/depreciation on investments |
|
|
(2,867,520 |
) |
|
|
6,017,752 |
|
Net change in deferred tax asset/liability |
|
|
(77,734 |
) |
|
|
44,862 |
|
GAAP versus tax basis consolidation of subsidiaries |
|
|
(1,332,687 |
) |
|
|
(863,702 |
) |
Other permanent book income and tax income differences |
|
|
1,348,624 |
|
|
|
170,680 |
|
Temporary book income and tax income differences |
|
|
(82,198 |
) |
|
|
(803,001 |
) |
Taxable income2 |
|
$ |
3,515,135 |
|
|
$ |
3,684,742 |
|
|
Schedule of Tax Character of Distributions Paid and Deemed Paid |
The tax character of distributions paid and deemed paid during the years ended December 31, 2023 and December 31, 2022 was as follows:
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
2022 |
|
Ordinary income |
|
$ |
3,432,757 |
|
|
$ |
2,142,247 |
|
Long-term capital gains |
|
|
— |
|
|
|
— |
|
Return of Capital |
|
|
— |
|
|
|
— |
|
Total |
|
$ |
3,432,757 |
|
|
$ |
2,142,247 |
|
|
Schedule of Components of Distributable Earnings/(Accumulated Losses) and Reconciliation to Accumulated Earnings/(Deficit) |
The tax basis components of distributable earnings (accumulated losses) and reconciliation to accumulated earnings (deficit) on a book basis for the years ended December 31, 2023 and December 31, 2022 were as follows:
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|
|
|
|
|
|
|
|
|
|
2023 |
|
|
2022 |
|
Undistributed ordinary income – tax basis |
|
$ |
332,806 |
|
|
$ |
250,428 |
|
Capital loss carry forwards |
|
|
(1,546,597 |
) |
|
|
— |
|
Unrealized appreciation on investments |
|
|
9,906,212 |
|
|
|
5,993,782 |
|
GAAP vs tax basis consolidation of subsidiaries |
|
|
— |
|
|
|
863,702 |
|
Other temporary differences |
|
|
(2,376,665 |
) |
|
|
1,389,575 |
|
Total accumulated earnings – book basis |
|
$ |
6,315,756 |
|
|
$ |
8,497,487 |
|
|
Schedule of Net Deferred Tax Asset |
The tax effect of the major temporary differences and carryforwards that give rise to the Corporation’s net deferred tax asset at December 31, 2023 and 2022 are approximately as follows:
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
2022 |
|
Investments |
|
$ |
(644,497 |
) |
|
$ |
(234,730 |
) |
NOL & tax credit carryforwards |
|
|
683,676 |
|
|
|
262,890 |
|
Deferred tax asset, net |
|
$ |
39,179 |
|
|
$ |
28,160 |
|
|
Schedule of Components of Income Tax Expense (Benefit) |
The components of income tax expense (benefit) reported in the consolidated statements of operations are as follows for the years ended December 31:
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
2022 |
|
|
2021 |
|
Current: |
|
|
|
|
|
|
|
|
|
Federal |
|
$ |
609,056 |
|
|
$ |
173,235 |
|
|
$ |
85,829 |
|
State |
|
|
58,320 |
|
|
|
(2,555 |
) |
|
|
14,835 |
|
|
|
|
667,376 |
|
|
|
170,680 |
|
|
|
100,664 |
|
Deferred: |
|
|
|
|
|
|
|
|
|
Federal |
|
|
(13,797 |
) |
|
|
92,304 |
|
|
|
(279,167 |
) |
State |
|
|
2,778 |
|
|
|
60,538 |
|
|
|
(22,977 |
) |
|
|
|
(11,019 |
) |
|
|
152,842 |
|
|
|
(302,144 |
) |
Total |
|
$ |
656,357 |
|
|
$ |
323,522 |
|
|
$ |
(201,480 |
) |
|
Schedule of Reconciliation of the Expense (Benefit) From Income Taxes at the Federal Statutory Rate |
A reconciliation of the expense (benefit) from income taxes at the federal statutory rate to the expense reported is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
2022 |
|
|
2021 |
|
Net investment income (loss), realized gain (loss) and unrealized gain (loss) before income taxes |
|
$ |
7,183,007 |
|
|
$ |
(558,327 |
) |
|
$ |
15,595,948 |
|
Expected tax expense (benefit) at statutory rate |
|
|
1,508,431 |
|
|
|
(117,249 |
) |
|
|
3,275,149 |
|
State - net of federal effect |
|
|
48,267 |
|
|
|
45,807 |
|
|
|
(8,142 |
) |
Pass-through expense (benefit) from portfolio investment |
|
|
487 |
|
|
|
721 |
|
|
|
(46,210 |
) |
Valuation allowance |
|
|
131,338 |
|
|
|
— |
|
|
|
— |
|
Tax benefit of RIC status |
|
|
(1,067,238 |
) |
|
|
400,329 |
|
|
|
(3,426,735 |
) |
RIC excise tax expense |
|
|
52,800 |
|
|
|
— |
|
|
|
— |
|
Other |
|
|
(17,728 |
) |
|
|
(6,086 |
) |
|
|
4,458 |
|
Total |
|
$ |
656,357 |
|
|
$ |
323,522 |
|
|
$ |
(201,480 |
) |
|