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. The significant components of our deferred tax assets and liabilities for the periods presented are as follows (in thousands):

	December 31,
	2020			2019
Deferred tax assets
Net operating losses	$	105,433		$	79,035
Tax credit carryforward		18,981			11,152
Non qualifying stock options		12,096			9,150
Deferred rent		—			11,755
Operating lease liabilities		31,052			—
Deferred revenue		59,713			1,706
Other		2,983			1,892
Total deferred tax assets		230,258			114,690
Valuation allowance		(197,527	)		(100,906	)
Deferred tax assets, net of valuation allowance		32,731			13,784
Deferred tax liabilities
Tangible and intangible assets		(5,760	)		(13,784	)
ROU assets		(26,971	)		—
Net deferred taxes	$	—		$	—

ASC Topic 740, Income Taxes, requires that the tax benefit of net operating losses, temporary differences and credit carryforwards be recorded as an asset to the extent that management assesses that realization is “more likely than not.” Realization of the future tax benefits is dependent on our ability to generate sufficient taxable income within the carryforward period. Because of our history of operating losses, management believes that recognition of the deferred tax assets arising from the above-mentioned future tax benefits is currently not likely to be realized and, accordingly, has provided a valuation allowance. The valuation allowance increased by $96.6 million and $30.2 million during the year ended December 31, 2020 and 2019, respectively.

In March 2020, the CARES Act was enacted and signed into law in response to COVID-19. The CARES Act, among other things, included several significant provisions that impacted corporate taxpayers' accounting for income taxes, including modification to the utilization of net operating losses and interest expense deduction limitations. However, none of these provisions have an impact on our tax provision.

Federal tax laws impose substantial restrictions on the utilization of net operating loss and credit carryforwards in the event of an ownership change, as defined in Section 382 of the Internal Revenue Code. Accordingly, our ability to utilize these carryforwards may be limited due to such ownership changes. We have completed a Section 382 analysis for changes in ownership through December 31, 2018 and an analysis is ongoing for ownership changes through December 31, 2020. Based on these analyses, we do not expect to have any permanent limitations on the utilization of our federal net operating losses. Under the TCJA federal income tax law, federal net operating losses incurred in 2018 and in future years may be carried forward indefinitely, but the deductibility of such federal net operating losses is limited. Net operating losses generated prior to 2018 are eligible to be carried forward up to 20 years. As of December 31, 2020, we had U.S. federal net operating losses of $192.5 million and U.S. federal tax credits of $18.8 million that will begin to expire in 2028. We also have $211.9 million of net operating losses that do not expire.

The effective tax rate of our provision for income taxes differs from the federal statutory rate for the periods presented as follows:

	Year Ended December 31,
	2020	2019	2018
Statutory rate	21.0%	21.0%	21.0%
State tax	13.8	8.1	5.5
Stock compensation	25.2	9.8	0.5
Permanent items	(0.1)	(1.0)	0.5
Credits	5.7	6.1	2.7
Other	0.5	0.3	0.1
Change in valuation allowance	(66.1)	(44.3)	(30.3)
Total	0.0%	0.0%	0.0%

We recognize, in our financial statements, the effect of a tax position when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. We had unrecognized tax benefits of $3.5 million as of December 31, 2020. A reconciliation of the beginning and ending amounts of unrecognized tax benefits during the periods presented are as follows (in thousands):

Balance at December 31, 2017	$	1,031
Additions in 2018		229
Balance at December 31, 2018		1,260
Additions in 2019		792
Balance at December 31, 2019		2,052
Additions in 2020		1,437
Balance at December 31, 2020	$	3,489

During the year ended December 31, 2020 and 2019, we recognized uncertain tax positions of $1.4 million and $0.8 million, respectively, related to a reduction of the research and development credit deferred tax asset. Unrecognized tax benefits may change during the next twelve months for items that arise in the ordinary course of business. We do not anticipate a material change to our unrecognized tax benefits over the next twelve months that would have an adverse effect on our operating results.

We recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. We had no accrued interest or penalties related to uncertain tax positions as of December 31, 2020 and 2019.

We file federal and certain state income tax returns, which provide varying statutes of limitations on assessments. However, because of net operating loss carryforwards, substantially all tax years since inception remain open to federal and state tax examination.