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Income Taxes | 12 Months Ended
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Dec. 31, 2016
Income Tax Disclosure [Abstract] |
Income Taxes | 11. INCOME TAXES The following is a reconciliation of the statutory federal income tax rate to the Company’s effective tax rate:
|  | December 31, |
|  | 2016 |  |  | 2015 |  |  | 2014 |
Expected income tax provision at the federal statutory rate |  |  | 35.0 | % |  |  | 35.0 | % |  |  | 35.0 | %
State taxes, net of federal benefit |  |  | 0.3 |  |  |  | (3.8 | ) |  |  | 4.6 |
Change in valuation allowance |  |  | (36.2 | ) |  |  | (30.7 | ) |  |  | (17.9 | )
Nondeductible expenses |  |  | — |  |  |  | — |  |  |  | (20.6 | )
Tax credits |  |  | 0.3 |  |  |  | 1.3 |  |  |  | — |
Other |  |  | 0.6 |  |  |  | (1.7 | ) |  |  | (3.2 | )
Income tax provision |  |  | 0.0 | % |  |  | 0.1 | % |  |  | (2.1 | %)
Significant components of the Company’s deferred tax assets are as follows:
|  | December 31, |
|  | 2016 |  |  | 2015 |
|  | (in thousands) |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 68,639 |  |  | $ | 30,572 |
Research credits |  |  | 2,643 |  |  |  | 1,919 |
Stock awards |  |  | 2,583 |  |  |  | 1,011 |
Other |  |  | 1,558 |  |  |  | 571 |
Gross deferred tax assets |  |  | 75,423 |  |  |  | 34,073 |
Valuation allowance |  |  | (74,520 | ) |  |  | (33,845 | )
Total deferred tax assets |  |  | 903 |  |  |  | 228 |
Deferred tax liabilities |  |  | (903 | ) |  |  | (228 | )
Net deferred tax assets |  | $ | — |  |  | $ | — |
The Company assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the two-year periods ended December 31, 2016 and December 31, 2015. Such objective evidence limits the ability to consider other subjective evidence, such as our projections for future growth. On the basis of this evaluation, as of December 31, 2016 and December 31, 2015, full valuation allowance has been recorded against Company’s net deferred tax asset. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as our projections for growth. The valuation allowance increased by approximately $40.7 million for the year ended December 31, 2016. The valuation allowance increased by approximately $9.1 million for the year ended December 31, 2015. At December 31, 2016, the Company had net operating loss carryforwards for federal income tax purposes of approximately $192.0 million that expire beginning in 2030 if not utilized, and federal research and development tax credit carryforwards of approximately $3.4 million that expire beginning in 2027 if not utilized. In addition, the Company had net operating loss carryforwards for California income tax purposes of approximately $31.1 million that expire beginning of 2030 if not utilized, and state research and development tax credit carryforwards of approximately $3.8 million which can be carried forward indefinitely. The Company had other state net operating losses of approximately $1.1 million that begin to expire in 2025. The Company had approximately insignificant and $0.2 million of minimum tax credit carryovers for federal and California income tax purposes, respectively. The minimum tax credits have no expiration date. The future utilization of the net operating loss and tax credit carryforwards and credits may be subject to an annual limitation, pursuant to Internal Revenue Code Sections 382 and 383, as a result of ownership changes that may have occurred previously or that could occur in the future. Due to the existence of the valuation allowance, future changes under Sections 382 and 383 will not impact the Company’s effective tax rate. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
|  | December 31, |
|  | 2016 |  |  | 2015 |  |  | 2014 |
|  | (in thousands) |
Balance at beginning of year |  | $ | 3,298 |  |  | $ | 2,815 |  |  | $ | 1,411 |
Additions (subtractions) based on tax positions related to prior year |  |  | 45 |  |  |  | (58 | ) |  |  | 405 |
Additions based on tax positions related to current year |  |  | 549 |  |  |  | 541 |  |  |  | 999 |
Balance at end of year |  | $ | 3,892 |  |  | $ | 3,298 |  |  | $ | 2,815 |
The unrecognized tax benefits, if recognized and in absence of full valuation allowance, would impact the income tax provision by $3.9 million, $3.3 million and $2.8 million as of December 31, 2016, 2015 and 2014, respectively. The Company has elected to include interest and penalties as a component of tax expense. During the years ended December 31, 2016, 2015 and 2014, the Company did not recognize accrued interest and penalties related to unrecognized tax benefits. Although the timing and outcome of an income tax audit is highly uncertain, the Company does not anticipate that the amount of existing unrecognized tax benefits will significantly change during the next 12 months. The Company files income tax returns in the U.S. federal, California, Maryland, Massachusetts, New Hampshire and New Jersey, tax jurisdictions. Due to the Company’s net operating loss and tax credit carryforwards, the income tax returns remain open to U.S. federal and California state tax examinations. The Company is not currently under examination in any tax jurisdiction.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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