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Income Taxes | 12 Months Ended
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Dec. 31, 2015
Income Taxes | (11) Income Taxes Interest and penalties related to any uncertain tax positions have historically been insignificant. The Company recognizes interest and penalties related to uncertain tax positions within the provision for income taxes. The total amount of unrecognized tax benefits that would affect the Company’s effective tax rate if recognized is $1.4 million as of December 31, 2015 and December 31, 2014. The following is a reconciliation of the total amounts of unrecognized tax benefits for the years ended December 31, 2015, 2014 and 2013 (in thousands):
|  | 2015 |  |  | 2014 |  |  | 2013 |
Beginning uncertain tax benefits |  | $ | 2,487 |  |  | $ | 1,674 |  |  | $ | 1,243 |
Prior year—increases |  |  | 120 |  |  |  | — |  |  |  | — |
Prior year—decreases |  |  | (762 | ) |  |  | — |  |  |  | — |
Current year—increases |  |  | 144 |  |  |  | 1,067 |  |  |  | 687 |
Current year—decreases for lapses in statutes of limitations |  |  | (439 | ) |  |  | (254 | ) |  |  | (256 | )
Ending uncertain tax benefits |  | $ | 1,550 |  |  | $ | 2,487 |  |  | $ | 1,674 |
The Company files income tax returns in the United States, Ireland and United Kingdom, or UK. The Company remains subject to tax examinations in the following jurisdictions as of December 31, 2015:
Jurisdiction |  | Tax Years |
United States (Federal and State) |  |  | 2012-2015 |
Ireland |  |  | 2010-2015 |
United Kingdom |  |  | 2014-2015 |
The Company expects gross liabilities of $579,000 to expire in 2016 based on statutory lapses. The components of loss from operations before taxes were as follows for the years ended December 31, 2015, 2014 and 2013 (in thousands):
|  | 2015 |  |  | 2014 |  |  | 2013 |
United States |  | $ | (10,137 | ) |  | $ | (7,331 | ) |  | $ | (9,234 | )
Ireland and United Kingdom |  |  | (108,153 | ) |  |  | (51,870 | ) |  |  | (160,187 | )
|  | $ | (118,290 | ) |  | $ | (59,201 | ) |  | $ | (169,421 | )
The benefit from income taxes shown in the accompanying consolidated statements of operations consists of the following for fiscal 2015, 2014 and 2013 (in thousands):
|  | 2015 |  |  | 2014 |  |  | 2013 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal-U.S. |  | $ | 1,053 |  |  | $ | 660 |  |  | $ | 122 |
State-U.S. |  |  | 113 |  |  |  | 117 |  |  |  | 118 |
Total current |  | $ | 1,166 |  |  | $ | 777 |  |  | $ | 240 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal-U.S. |  |  | (3,343 | ) |  |  | (3,689 | ) |  |  | (4,065 | )
State-U.S. |  |  | (605 | ) |  |  | (226 | ) |  |  | 631 |
Ireland and United Kingdom |  |  | (9,023 | ) |  |  | 3,335 |  |  |  | (33,106 | )
Change in valuation allowance |  |  | 8,719 |  |  |  | (3,034 | ) |  |  | 33,106 |
Total deferred |  | $ | (4,252 | ) |  | $ | (3,614 | ) |  | $ | (3,434 | )
Benefit from income taxes |  | $ | (3,086 | ) |  | $ | (2,837 | ) |  | $ | (3,194 | )
The benefit from income taxes differs from the amount computed by applying the statutory income tax rate to income before taxes due to the following for fiscal 2015, 2014 and 2013 (in thousands):
|  | 2015 |  |  | 2014 |  |  | 2013 |
Benefits from taxes at statutory rate |  | $ | (29,572 | ) |  | $ | (14,786 | ) |  | $ | (42,355 | )
Rate differential |  |  | 8,572 |  |  |  | 9,493 |  |  |  | 18,494 |
Change in valuation reserves |  |  | 8,719 |  |  |  | (3,034 | ) |  |  | 33,106 |
Derivative liabilities |  |  | 187 |  |  |  | (2,706 | ) |  |  | (11,984 | )
Gain on extinguishment of debt |  |  | (328 | ) |  |  | (9,509 | ) |  |  | — |
Research and development credits |  |  | (1,284 | ) |  |  | (1,455 | ) |  |  | (2,008 | )
Tax return to provision adjustments |  |  | 2,248 |  |  |  | 10,026 |  |  |  | 125 |
Cumulative translation adjustment |  |  | 7,811 |  |  |  | 8,061 |  |  |  | (280 | )
Permanent and other |  |  | 561 |  |  |  | 1,073 |  |  |  | 1,708 |
Benefit from income taxes |  | $ | (3,086 | ) |  | $ | (2,837 | ) |  | $ | (3,194 | )
During 2015, the Company recorded adjustments to its deferred tax accounts related to the impact of foreign exchange rate changes and to reconcile the financial statement accounts to the amounts reported on its filed 2014 foreign tax returns, primarily for the impact of US GAAP to local statutory adjustments. These adjustments were fully offset with valuation allowances based on the Company’s position with respect to the realizability of its recorded deferred tax assets for non-U.S. entities. The Company is subject to corporate tax rate in Ireland of 25% for non-trading activities and 12.5% for trading activities. For the years ended December 31, 2015, 2014 and 2013, the Company applied the statutory corporate tax rate of 25% for Amarin Corporation plc, reflecting the non-trading tax rate in Ireland. However, for Amarin Pharmaceuticals Ireland Limited, a wholly-owned subsidiary of Amarin Corporation plc, the Company applied the 12.5% Irish trading tax rate. The income tax effect of each type of temporary difference comprising the net deferred tax asset as of December 31, 2015 and 2014 is as follows (in thousands):
|  | 2015 |  |  | 2014 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating losses |  | $ | 88,996 |  |  | $ | 80,096 |
Stock based compensation |  |  | 17,975 |  |  |  | 15,600 |
Depreciation |  |  | 74 |  |  |  | (90 | )
Tax credits |  |  | 3,076 |  |  |  | 2,141 |
Other reserves and accrued liabilities |  |  | 2,796 |  |  |  | 1,708 |
Gross deferred tax assets |  |  | 112,917 |  |  |  | 99,455 |
Less: valuation allowance |  |  | (94,684 | ) |  |  | (85,965 | )
Total deferred tax assets |  | $ | 18,233 |  |  | $ | 13,490 |
The Company assesses whether it is more-likely-than-not that the Company will realize its deferred tax assets. The Company determined that it was more-likely-than-not that the Irish, UK, and Israeli net operating losses and the related deferred tax assets would not be realized in future periods and a full valuation allowance has been provided for all periods. As of December 31, 2015, deferred tax assets of approximately $3.0 million relate to certain tax credit carryforwards resulting from excess tax benefits of stock-based compensation using the with-and-without approach, the tax benefit of which, when recognized, will be accounted for as a credit to additional paid-in capital rather than a reduction to the income tax provision. Such amount has been netted with the tax credits line in the table above. In November 2015, the FASB issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes, which changes how deferred taxes are classified on organizations’ balance sheets. The ASU eliminates the current requirement for organizations to present deferred tax liabilities and assets as current and non-current in a classified balance sheet. Instead, organizations will be required to classify all deferred tax assets and liabilities as non-current. The amendments in this ASU are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company early adopted ASU 2015-17 effective December 31, 2015 on a prospective basis. Adoption of this ASU resulted in a reclassification of $0.9 million of the net current deferred tax asset to the net non-current deferred tax asset in the consolidated balance sheet as of December 31, 2015. No prior periods were retrospectively adjusted. The following table reflects the activity in the valuation allowance for the years ended December 31, 2015 and 2014 (in thousands):
|  | 2015 |  |  | 2014 |
Beginning valuation allowance |  | $ | 85,965 |  |  | $ | 88,999 |
Increase as reflected in income tax expense |  |  | 16,291 |  |  |  | 5,081 |
Cumulative translation adjustment |  |  | (7,572 | ) |  |  | (8,115 | )
Ending valuation allowance |  | $ | 94,684 |  |  | $ | 85,965 |
The Company has combined Irish, UK, and Israeli net operating loss carryforwards of $565.7 million, which do not expire. The total net operating loss carryforwards increased by approximately $52.4 million from the prior year primarily as a result of current year losses generated by the Company’s Irish subsidiaries, partially offset by the impact of foreign exchange rate changes and adjustments to reconcile the financial statement accounts to the amounts reported on the filed 2014 foreign tax returns. In addition, the Company has available U.S. federal tax credit carryforwards of $5.8 million and state tax credit carryforwards of $1.6 million. These amounts exclude the impact of any unrecognized tax benefits. These carryforwards, which will expire starting between 2022 and 2035, may be used to offset future taxable income, if any. The Company recognized a tax benefit related to the extension of the research and development credits retroactively enacted during the fourth quarter of 2015 and recorded a benefit of approximately $1.3 million for the credit generated during the year. As of December 31, 2015, earnings of $20.6 million have been retained indefinitely for reinvestment by foreign subsidiary or there is an expectation that any reinvestment can be recovered tax-free without significant cost, and the entity expects to ultimately use that means of recovery for domestic subsidiary companies; therefore, no provision has been made for income taxes that would be payable upon the distribution of such earnings and it would not be practicable to determine the amount of the related unrecognized deferred income tax liability.

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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=6907707&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=6907707&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=6907707&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=6907707&loc=d3e32537-109319 + Details
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