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Income Taxes
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Taxes INCOME TAXES
The Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes. These provisions require a company to determine whether it is more likely than not that a tax position will be sustained upon examination based on the technical merits of the position. If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements. The Company did not have any unrecognized tax positions as of December 31, 2022 and 2021.
The federal returns for tax years 2019 through 2021 remain open to examination, and the tax years 2018 through 2021 remain open to examination by certain other taxing jurisdictions to which the Company is subject. Additional years may be open to the extent attributes are being carried forward to an open year.
Deferred income taxes arise from the temporary differences in the recognition of income and expenses for tax purposes. A valuation allowance is established when the Company believes that it is more likely than not that some portion of its deferred tax assets will not be realized.
Deferred tax assets and liabilities were comprised of the following at December 31, 2022 and 2021: 
(In thousands)20222021
Deferred tax assets:
Accounts receivable and financing receivables$877 $625 
Accrued vacation907 678 
Stock-based compensation1,909 1,905 
Deferred revenue1,002 988 
Research expenditures9,779 — 
Accrued severance 490 44 
Right of use asset1,848 1,740 
Credits— 2,472 
Other(93)15 
Net operating loss3,738 3,560 
Deferred tax assets20,457 12,027 
Less: Valuation allowance604 622 
Total deferred tax assets$19,853 $11,405 
Deferred tax liabilities:
Intangible assets$20,941 $18,002 
Accrued liabilities and other9,259 4,668 
Fixed assets527 875 
Right of use liability1,884 $1,740 
Total deferred tax liabilities$32,611 $25,285 
Total net deferred tax liability$(12,758)$(13,880)
Under the Tax Cuts and Jobs Act, Internal Revenue Code ("IRC") Section 174 amended the federal tax treatment of research or experimental expenditures paid or incurred during the tax year, which allowed for expensing of such costs in the year incurred for federal income tax purposes. Effective for the 2022 tax year, taxpayers are required to capitalize and amortize specified research or experimental expenditures over a five-year period. As a result of the change to IRC Section 174, a deferred tax asset of $9.8 million was recorded for the tax year ended December 31, 2022.
Significant components of the income tax provision for the years ended December 31, 2022, 2021 and 2020 were as follows:
(In thousands)202220212020
Current provision:
Federal$6,482 $731 $244 
State2,420 413 1,539 
Deferred provision:
Federal(4,769)3,331 2,766 
State(1,919)171 (11)
Total income tax provision$2,214 $4,646 $4,538 
The difference between income taxes at the U.S. federal statutory income tax rate of 21% for the years ended December 31, 2022, 2021 and 2020, and those reported in the consolidated statements of operations for the years ended December 31, 2022, 2021 and 2020 are as follows:
(In thousands)202220212020
Income taxes at U.S. federal statutory rate$3,797 $4,846 $3,945 
Provision-to-return adjustments(539)117 455 
State income tax, net of federal tax effect428 509 908 
Tax credits(1,254)(1,274)(958)
Contingent consideration(406)— — 
Stock-based compensation(112)(74)255 
Non-deductible compensation - 162(m)306 510 — 
Other(6)12 (67)
Total income tax provision$2,214 $4,646 $4,538 
Our effective tax rates for the years ended December 31, 2022, 2021 and 2020 were 12%, 20% and 24% respectively. Our effective tax rate for 2022 was impacted by the non-taxable nature of our recorded gain on contingent consideration, which served to reduce the year's effective tax rate by 2.2%, while lowered provision-to-return adjustments resulted in an incremental 3.5% decrease in our effective tax rate for 2022 compared to 2021.
We have federal net operating loss carryforwards related to the acquisition of HHI and Get Real Health of $5.9 million, $7.9 million and $12.2 million for the years ending December 31, 2022, 2021, and 2020, respectively, which expire at various dates from 2026 to 2035. We have state net operating loss carryforwards related to the acquisition of HHI and Get Real Health of $39.8 million, $29.9 million and $34.4 million for the years ending December 31, 2022, 2021, and 2020, respectively, which expire at various dates from 2023 to 2036.
Realization of deferred tax assets associated with the state net operating loss carryforwards is dependent upon generating sufficient taxable income prior to their expiration. We believe it is more likely than not that the benefit from certain state NOL carryforwards associated with the acquisition of Get Real Health will not be realized. In recognition of this risk, we have provided a valuation allowance on the deferred tax assets related to these state NOL carryforwards of $0.6 million after both December 31, 2022 and 2021, respectively.