XML 33 R21.htm IDEA: XBRL DOCUMENT

Income Taxes

3 Months Ended

Mar. 31, 2021

15. Income Taxes

The income tax provision for the interim periods reflects the Company’s estimate of the effective tax rates expected to be applicable for the full fiscal years, adjusted for any discrete events which are recorded in the period in which they occur. The estimates are reevaluated each quarter based on the Company’s estimated tax expense for the full fiscal year.

The following table presents information regarding Company’s income tax expense recognized for the three months ended March 31, 2021 and 2020:


	Three months ended March 31,
		2021		2020
Benefit from income taxes	$	(188)	$	—
Effective tax rate		(1.2%)		0.0%

The Company is subject to U.S. federal and state income taxes. For the three months ended March 31, 2021 the Company recorded a benefit from income taxes of $188 and none, respectively. The benefit from income taxes in the first quarter of 2021 was primarily related to a benefit from income taxes of $1,527 related to excess tax benefits of stock-based compensation offset by provisions for income taxes of $1,339 attributable to state income tax expense. The Company expects to record an income tax provision in the remaining quarters of 2021 that exceeds excess tax benefits from income taxes. As a result, these excess tax benefits and provisions recorded on a quarterly basis are not expected to have any effect on our annual provision for (benefit from) income taxes. For the three months ended March 31, 2021 and 2020, no federal current income tax expense was recorded as the Company has enough federal net operating losses (or “NOLs”) carryover to offset taxable income. The Company has a full valuation allowance against its deferred tax assets as of March 31, 2021 and 2020 and no deferred tax expense was recorded in either period.

Deferred tax assets and deferred tax liabilities are recognized based on temporary differences between the financial reporting and tax basis of assets and liabilities using statutory rates. The Company recorded a valuation allowance against all of its deferred tax assets as of March 31, 2021 and December 31, 2020. The Company intends to continue to maintain a full valuation allowance on its deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. Given the Company’s current earnings and anticipated future earnings, however, the Company believes that there is a reasonable possibility that within the next 12 months, sufficient positive evidence may become available to allow the Company to reach a conclusion that a significant portion or all of the valuation allowance will no longer be needed. Release of the valuation allowance would result in the recognition of certain deferred tax assets and a decrease to the provision for income taxes for the period the release is recorded. The exact timing and amount of the valuation allowance release, however, are subject to change on the basis of the level of profitability that the Company is able to actually achieve.

- 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 + Details