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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Summary of Income (Loss) Before Income Taxes

Income before income taxes consisted of (in thousands):

		Year Ended December 31,
		2018				2017				2016
Domestic		$	24,841			$	4,471			$	26,880
Foreign			8,337				2,669				—
Income before income taxes		$	33,178			$	7,140			$	26,880

Summary of Income Tax Expense

Funko, Inc. is taxed as a corporation and pays corporate federal, state and local taxes on income allocated to it from FAH, LLC based upon Funko, Inc’s economic interest held in FAH, LLC. FAH, LLC is treated as a pass-through partnership for income tax reporting purposes. FAH, LLC’s members, including the Company, are liable for federal, state and local income taxes based on their share of FAH, LLC’s pass-through taxable income. The results for the year ended December 31, 2017 reflect the U.K. Corporation Tax attributable to Funko UK, Ltd., but do not reflect the U.S. tax expense of FAH, LLC prior to the IPO, which as a pass-through entity, was not subject to U.S. income tax.

The components of the Company’s income tax expense consisted of the following (in thousands):

		Year Ended December 31,
		2018				2017				2016
Current income taxes:
Federal		$	3,526			$	941			$	—
State and local			486				365				—
Foreign			1,758				952				—
Current income taxes		$	5,770			$	2,258			$	—
Deferred income taxes:
Federal		$	(819	)		$	(651	)			—
State and local			(70	)			(16	)			—
Foreign			(14	)			(51	)			—
Deferred income taxes		$	(903	)		$	(718	)		$	—
Income tax expense		$	4,867			$	1,540			$	—

Reconciliation of Income Tax Expense

A reconciliation of income tax expense from operations computed at the U.S. federal statutory income tax rate to the Company’s effective income tax rate is as follows:

			Year Ended December 31,
			2018				2017				2016
Expected U.S. federal income taxes    at statutory rate				21.0	%			34.0	%			34.0	%
State and local income taxes, net of    federal benefit				1.0	%			4.6	%			0.0	%
Foreign taxes				4.7	%			12.6	%			0.0	%
Non-deductible expenses				2.6	%			1.7	%			0.0	%
Enactment of the Tax Cuts and Jobs    Act				0.0	%			65.7	%			0.0	%
Change in valuation allowance				0.0	%			-70.3	%
Non-controlling interest				-12.5	%			-9.6	%			0.0	%
LLC flow-through structure				0.0	%			-17.1	%			-34.0	%
Other, net				-2.1	%			0.0	%
Income tax expense				14.7	%			21.6	%			0.0	%

Summary of Deferred Tax Assets and Liabilities

The significant items comprising deferred tax assets and liabilities is as follows (in thousands):

		December 31,
		2018				2017
Deferred tax assets:
Investment in partnership		$	18,229			$	13,403
Tax Receivable Agreement liability			1,544
Stock-based compensation			456				85
Intangibles			—				151
Property and equipment			10				—
Other			51				—
Gross deferred tax assets			20,290				13,639
Valuation allowance			(8,803	)			(8,862	)
Deferred tax assets, net of valuation allowance			11,487				4,777
Deferred tax liabilities:
Investment in partnership			(4,146	)			(5,290	)
Property and equipment			—				(24	)
Gross deferred tax liabilities			(4,146	)			(5,314	)
Net deferred tax liabilities		$	7,341			$	(537	)

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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Tabular disclosure of income before income tax between domestic and foreign jurisdictions.

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