Cabaletta Bio, Inc. Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

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


	For the Year Ended December 31,
	2022			2021
Expected income tax benefit at the federal statutory rate		21.0	%		21.0	%
State and local taxes, net of federal benefit		7.9			12.5
Research and development credit, net		4.5			4.4
Non-deductible items and other		(0.6	)		(0.6	)
Change in state tax rate		(7.4	)		—
Change in valuation allowance		(25.4	)		(37.3	)
Total		0.0	%		0.0	%

The principal components of the Company’s deferred tax assets and liabilities consisted of the following:


	December 31,
	2022			2021
Deferred tax assets:
Federal, state and local net operating loss carryforwards	$	28,880		$	28,857
Research and development tax credits		5,859			3,359
Capitalized research and development costs		9,640			—
Stock-based compensation deductions		3,840			2,616
License fee deductions		262			318
Operating lease liabilities		1,535			—
Accrued expenses		1,165			1,074
Gross deferred tax assets		51,181			36,224
Less: valuation allowance		(49,689	)		(36,224	)
Total deferred tax assets		1,492			—
Deferred tax liabilities:
Operating lease assets		(1,492	)		—
Net deferred tax assets	$	—		$	—