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Income Taxes
 3 Months Ended
Mar. 31, 2023
Income Taxes  
Income Taxes

10. Income Taxes

 

The Company computes its year-to-date provision for income taxes by applying the estimated annual effective tax rate to year-to-date pretax income or loss and adjusts the provision for discrete tax items recorded in the period. A valuation allowance has been established against the Company’s U.S. federal and state deferred tax assets, which results in an annualized effective tax rate for the Company’s U.S. operations of 0%. For the three months ended March 31, 2023, the Company recorded an income tax benefit of $13 thousand related to foreign tax activity on a pretax loss of $16.4 million, resulting in an effective tax rate of 0.08%. For the three months ended March 31, 2022, the Company recorded an income tax provision of $0.03 million related to foreign tax activity on a pretax loss of $9.7 million, resulting in an effective tax rate of (0.4)%. These effective tax rates differ from the U.S. federal statutory rate primarily due to the valuation allowance against the Company’s domestic deferred tax assets.