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Income Taxes
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The components of the provision for income taxes for the periods indicated are as follows (in thousands):
Year Ended December 31,
202220212020
United States$(1,600,323)$(1,072,489)$(1,804,623)
Foreign21,684 21,570 7,232 
Loss before income taxes$(1,578,639)$(1,050,919)$(1,797,391)
The provision for income taxes for the periods indicated are as follows (in thousands):
Year Ended December 31,
202220212020
Current provision
Federal$— $— $— 
State1,256 1,272 1,201 
Foreign4,240 7,228 1,156 
Total current$5,496 $8,500 $2,357 
Deferred provision
Federal481 639 (36,375)
State1,256 — (9,534)
Foreign(1,361)2,086 (982)
Total deferred376 2,725 (46,891)
Total provision for (benefit from) income taxes$5,872 $11,225 $(44,534)
A reconciliation of the U.S. federal statutory income tax rates to the Company’s effective tax rate is as follows:
Year Ended December 31,
202220212020
Provision at federal statutory rate21.0 %21.0 %21.0 %
State, net of federal benefit2.1 2.6 3.2 
Permanent tax adjustments(0.4)(0.2)(0.4)
Nondeductible expenses(0.7)(1.1)(0.6)
Stock-based compensation(4.9)2.5 1.0 
Convertible senior notes— — 2.7 
Change in valuation allowance(17.1)(25.2)(24.0)
Other adjustments(0.4)(0.7)(0.3)
Provision for income taxes(0.4)%(1.1)%2.6 %
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes at the enacted rates. The significant components of the Company’s deferred tax assets and liabilities as of the periods indicated were as follows (in thousands):
December 31,
20222021
Deferred tax assets:
Net operating loss carryforwards$2,127,233 $2,079,896 
Insurance reserves and accruals296,423 276,625 
Stock-based compensation19,132 38,066 
Capitalized research expenses163,370 — 
Accrued legal settlement/fees114,963 89,680 
Lease liability55,579 66,211 
Accrued and other liabilities76,311 64,555 
Total deferred tax assets2,853,011 2,615,033 
Less: Valuation allowance(2,706,982)(2,408,647)
Deferred tax assets, net of valuation allowance146,029 206,386 
Deferred tax liabilities:
State income taxes(124,982)(115,768)
Operating lease right of use assets(36,379)(59,838)
Convertible senior notes— (31,892)
Total deferred tax liabilities(161,361)(207,498)
Net deferred tax assets (liabilities)$(15,332)$(1,112)
A reconciliation of the valuation allowance is as follows (in thousands):
Year Ended December 31,
202220212020
Beginning balance$2,408,647 $2,144,548 $1,751,118 
Net changes in deferred tax assets and liabilities298,335 264,099 393,430 
Ending balance$2,706,982 $2,408,647 $2,144,548 
The valuation allowance increased by $298.3 million for the year ended December 31, 2022, compared to the increase of $264.1 million for the year ended December 31, 2021. The Company believes that, based on a number of factors, the available objective evidence creates sufficient uncertainty regarding the realizability of the deferred tax assets such that a valuation allowance has been recorded. These factors include the Company’s history of net losses since its inception.
As of December 31, 2022, the Company had U.S. federal and state net operating loss carryforwards of approximately $7.8 billion and $6.7 billion, respectively.
The federal net operating loss carryforwards generated through December 31, 2017 expire at various dates beginning in 2030 and will continue to expire through 2037, while federal net operating loss carryforwards generated in 2018 or later do not expire. The state net operating loss carryovers will begin to expire in 2023 and will continue to expire at various times depending upon individual state carryforward rules. Utilization of the net operating loss carryforwards are subject to various limitations including the ownership change limitations provided by Internal Revenue Code (IRC) Section 382 and similar state provisions.
The Company is subject to taxation in the United States and various foreign jurisdictions. All net operating losses generated to date are subject to adjustment for U.S. federal and state income tax purposes. Additionally, all tax years remain open to examination as of December 31, 2022 with the exception of tax years beginning before 2018 in Canada and 2021 in the United Kingdom.
The Company has not provided foreign withholding taxes on the undistributed earnings of its foreign subsidiaries as of December 31, 2022, 2021, and 2020, because it intends to permanently reinvest such earnings outside of the U.S. If these foreign earnings were to be repatriated in the future, the related U.S. tax liability will be immaterial, due to the participation exemption put in place by the 2017 Tax Act.
The Company’s policy is to recognize interest and penalties associated with uncertain tax benefits as part of the income tax provision and include accrued interest and penalties with the related income tax liability on the Company’s consolidated balance sheets. To date, the Company has not recognized any interest and penalties in its consolidated statements of operations, nor has it accrued for or made payments for interest and penalties. The Company has no material unrecognized tax benefits as of December 31, 2022, 2021 and 2020.