Kodiak Sciences Inc. Notes to Consolidated Financial Statements (in thousands, except share and per share data) 100 Year Ended December 31, 2023 Year Ended December 31, 2022 Year Ended December 31, 2021 Current: Federal $ — $ — $ — State — — — Foreign 33 33 74 Total current 33 33 74 Deferred: Federal — — — State — — — Foreign — — — Total deferred — — — Provision (Benefit f ) for income taxes $ 33 $ 33 $ 74 The tax effe f cts of temporary r differences that give rise to significant components of the net deferred tax assets are as follows (in thousands): December 31, 2023 December 31, 2022 Deferred tax assets: Net operating loss carryforwards $ 133,919 $ 117,232 Intangible assets 163,841 166,259 Research and development tax credits 29,630 25,110 Stock-based compensation 24,344 23,576 Accrua r ls 1,086 1,562 Operating lease liabi a lity 15,845 25,548 Sec. 174 Capi a talized R&D 16,992 7,914 Total deferred tax assets 385,657 367,201 Valuation allowance (373,474) (347,789) Net deferred tax assets 12,183 19,412 Deferred tax liabi a lities: Operating lease right-of-use asset (10,362) (17,073) Property and equipment (1,821) (2,339) Total deferred tax liabilities (12,183) (19,412) Total net deferred tax assets $ — $ — The Company has recorded a full valuation allowance against its net deferred tax assets due to the uncertainty as to whether such assets will be realized. The net change in the total valuation allowance for the years ended December 31, 2023 and 2022, was an increase of approximately $25.7 million and $72.0 million, respectively. The Tax Cuts and Jobs Act eliminated the option to deduct research and development expenditures currently and requires taxpayers to capitalize and amortize them pursuant to Internal Revenue Code Section 174 beginning in 2022. The capitalized expenses are amortized over a 5-year period for domestic expenses and a 15-year period for foreign expenses. NOLs and tax credit carry-forwards are subj u ect to review and possible adju d stment by the Internal Revenue Service (“IRS”) and may become subj u ect to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50% as defined under Sections 382 and 383 in the Internal Revenue Code, which could limit the amount of tax attributes that can be utilized annually to offs f et future taxabl a e income or tax liabilities. The amount of the annual limitation is determined based on the Company’s value immediately prior to the ownership change. The Company periodically completes a Section 382 analysis. Subs u equent ownership changes since the most recent study t may further affe f ct the limitation in future years.