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Income Taxes | 6 Months Ended
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Jun. 30, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes A reconciliation of the U.S. federal statutory tax rate to the Company’s effective income tax rate is as follows:
| Three months ended June 30, |  | Six months ended June 30,
| 2019 |  | 2018 |  | 2019 |  | 2018
U.S. federal statutory tax rate | 21.0 | % |  | 21.0 | % |  | 21.0 | % |  | 21.0 | %
State income taxes, net of federal benefit | 1.7 |  |  | 1.0 |  |  | 1.0 |  |  | (0.3 | )
Non-U.S. income taxed at different rates | 0.7 |  |  | (3.5 | ) |  | 1.0 |  |  | 0.3 |
Reduction in tax benefit related to stock-based awards | (1.1 | ) |  | 6.5 |  |  | (1.8 | ) |  | (1.5 | )
Non-deductible expenses | — |  |  | (9.5 | ) |  | (0.3 | ) |  | (9.3 | )
Research and development credit | 0.4 |  |  | (3.9 | ) |  | 0.6 |  |  | 0.6 |
Increase in valuation allowance | (20.7 | ) |  | (42.2 | ) |  | (17.9 | ) |  | (36.0 | )
Other | (0.4 | ) |  | — |  |  | (0.3 | ) |  | — |
Effective income tax rate | 1.6 | % |  | (30.6 | )% |  | 3.3 | % |  | (25.2 | )%
Fluctuations in effective tax rates have historically been impacted by permanent tax differences with no associated income tax impact, changes in the valuation allowance, changes in state apportionment factors, including the effect on state deferred tax assets and liabilities, and non-U.S. income taxed at different rates. Net deferred tax assets arise due to the recognition of income and expense items for tax purposes, which differ from those used for financial statement purposes. ASC 740, Income Taxes, provides for the recognition of deferred tax assets if realization of such assets is more likely than not. In assessing the need for a valuation allowance in the second quarter of 2018, the Company considered all available objective and verifiable evidence, both positive and negative, including historical levels of pre-tax income (loss) both on a consolidated basis and tax reporting entity basis, legislative developments, and expectations and risks associated with estimates of future pre-tax income. As a result of this analysis, the Company determined that it was more likely than not that it would not realize the benefits of certain deferred tax assets and, therefore, recorded a $15.5 million valuation allowance against the carrying value of net deferred tax assets, except for deferred tax liabilities related to non-amortizable intangible assets and certain state jurisdictions. As all available evidence should be taken into consideration when assessing the need for a valuation allowance, the sale of the CICT segment provided a source of income to support the release of $11.5 million of the valuation allowance which resulted in a deferred tax asset of $18.7 million. As such, the Company reversed this portion of the valuation allowance during the fourth quarter of 2018. The increase in the valuation allowance during the three months ended June 30, 2019, reflects management’s evaluation of deferred tax assets more-likely-than-not to be used after giving consideration to the gain from the sale of the CICT segment and anticipated results of operations. In January 2017, the Internal Revenue Service notified the Company that it would examine the Company’s federal tax returns for the year ended December 31, 2014. The examination included (1) the corporate returns and (2) employment tax matters. The IRS fieldwork has been completed in relation to the corporate returns with no adverse findings. Further discussion of the employment tax matter can be found in Note 18 — “Related Party Transaction.”

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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