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Income Taxes
 3 Months Ended
Mar. 31, 2022
Income Taxes  
Income Taxes

Note 9 — Income Taxes

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Income taxes are estimated for each of the jurisdictions in which the Company operates. Deferred income taxes reflect the net tax effect of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as the tax effect of carryforwards. Realization of net deferred tax assets is dependent on future taxable income. At March 31, 2022, the Company’s U.S. deferred tax assets are fully offset by a valuation allowance since the Company cannot conclude that it is more likely than not that these future benefits will be realized.

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At the end of each interim reporting period, the effective tax rate is aligned with expectations for the full year. This estimate is used to determine the income tax provision on a year-to-date basis and may change in subsequent interim periods.

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Income before income taxes and income tax expense (benefit) for the three months ended March 31, 2022 and 2021 were as follows:

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Three months ended March 31,

 

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2022

    

2021

 

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(in thousands)

 

Income before income taxes

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$

13,714

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$

2,792

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Income tax expense (benefit)

 

$

384

 

$

298

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The Company’s tax expense for the three months ended March 31, 2022 was $0.4 million, compared to $0.3 million for the comparable prior period. The 2022 tax expense included an expense of $0.3 million related to the Company’s non-U.S. operations and $0.1 million related to the Company’s domestic operations. The 2021 tax expense included an expense of $0.2 million related to the Company’s non-U.S. operations and $0.1 million related to the Company’s domestic operations. For the three months ended March 31, 2022 and 2021, the Company’s U.S. deferred tax assets are fully offset by a valuation allowance since the Company cannot conclude that it is more likely than not that these future benefits will be realized. The domestic tax expense for both periods is primarily attributable to the tax amortization of indefinite lived intangible assets that is not available to offset U.S. deferred tax assets. The foreign tax expense for both periods is primarily attributable to non-US operations profits and foreign withholding taxes on unremitted earnings, offset by the amortization of intangible assets.