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Income Taxes
 3 Months Ended
Mar. 31, 2022
Income Taxes [Abstract]  
Income Taxes 6. Income Taxes 

 

Income Tax Expense

Our effective income tax rate was an expense of 40% and a benefit of 30% for the three months ended March 31, 2022 and 2021, respectively. Our income tax rate for the three months ended March 31, 2022 was primarily impacted by changes in our valuation allowance against our net deferred tax assets, non-deductible executive compensation, the foreign derived intangible

income deduction, the research and development tax credit, changes in our uncertain tax position liabilities, and tax shortfalls on stock compensation. Our income tax rate for the three months ended March 31, 2021 was primarily impacted by non-deductible executive compensation, changes in our valuation allowance against our net deferred tax assets, changes in our uncertain tax position liabilities, the research and development tax credit, and excess tax benefits on stock compensation.

Deferred Income Taxes

We generate deferred tax assets primarily as a result of capital leases, net operating losses, amortization of research and experimental expenses, excess interest carryforward, stock compensation, and accrued compensation. Our deferred tax liabilities are primarily made up of intangible assets acquired in previous years, capital leases, and unrealized gains and losses.

We maintained a net deferred tax liability of $22.9 million and $26.4 million as of March 31, 2022 and December 31, 2021, respectively. Our valuation allowance against our deferred tax assets was $14.8 million and $13.3 million as of March 31, 2022 and December 31, 2021, respectively, primarily related to net operating loss carryforwards and disallowed excess interest carryforwards.