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Income Taxes | 12 Months Ended
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Dec. 31, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | 15. Income Taxes Income Tax Provision The components of the provision for income taxes are as follows for the years ended December 31, 2020, 2019, and 2018 (in thousands):
|  | Year Ended December 31, |
|  | 2020 |  |  | 2019 |  |  | 2018 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | — |  |  | $ | — |  |  | $ | — |
State and local |  |  | 84 |  |  |  | 168 |  |  |  | 229 |
Total current tax expense |  |  | 84 |  |  |  | 168 |  |  |  | 229 |
Deferred tax (benefit): |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | — |  |  |  | — |  |  |  | — |
State and local |  |  | — |  |  |  | — |  |  |  | — |
Total deferred tax (benefit) |  |  | — |  |  |  | — |  |  |  | — |
Provision for income taxes |  | $ | 84 |  |  | $ | 168 |  |  | $ | 229 |
Pretax loss for all periods presented were classified as Domestic. Tax Rate Reconciliation The Company’s effective tax rate for the years ended December 31, 2020, 2019, and 2018 was (0.04)%, (0.12)%, and (0.27)%, respectively. A reconciliation of the provision for income taxes at the statutory rate to the amount reflected in the consolidated statements of operations is as follows (in thousands):
|  | Year Ended December 31, |
|  | 2020 |  |  | 2019 |  |  | 2018 |
Income taxes at statutory rate |  | $ | (42,570 | ) |  | $ | (29,990 | ) |  | $ | (17,839 | )
State income taxes, net of federal benefit |  |  | (5,417 | ) |  |  | (1,096 | ) |  |  | 180 |
Permanent differences |  |  | 1,264 |  |  |  | 772 |  |  |  | 229 |
Change in valuation allowance |  |  | 46,901 |  |  |  | 30,051 |  |  |  | 17,756 |
Other |  |  | (94 | ) |  |  | 431 |  |  |  | (97 | )
Provision for income taxes |  | $ | 84 |  |  | $ | 168 |  |  | $ | 229 |
Deferred Tax Assets (Liabilities) The Company computes income taxes using the liability method. This method requires recognition of deferred tax assets and liabilities, measured by enacted rates, attributable to temporary differences between the financial statements and the income tax basis of assets and liabilities. In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that certain deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in those specific jurisdictions prior to the dates on which such net operating losses expire. The Company maintained a full valuation allowance against its net deferred tax assets for December 31, 2020 and 2019 because the Company has determined that is it more likely than not that these assets will not be fully realized based on a current evaluation of expected future taxable income and the Company is in a cumulative loss position. As of December 31, 2020 and 2019 the Valuation Allowance balance was $121.9 million and $75.0 million, respectively. The Valuation Allowance was $44.9 million and $27.5 million as of December 31, 2018 and January 1, 2018, respectively. Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands):
|  | As of December 31, |
|  | 2020 |  |  | 2019 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 102,252 |  |  | $ | 66,879 |
Inventory reserves |  |  | 12,409 |  |  |  | 5,911 |
Stock-based compensation |  |  | 3,119 |  |  |  | 840 |
Accrued Expense |  |  | 1,456 |  |  |  | 867 |
Depreciation |  |  | — |  |  |  | 114 |
Right of Use Asset |  |  | 4,175 |  |  |  | — |
Allowance for Doubtful Accounts |  |  | 1,809 |  |  |  | 173 |
Other |  |  | 836 |  |  |  | 423 |
Total deferred tax assets |  |  | 126,056 |  |  |  | 75,207 |
Less: valuation allowance |  |  | (121,859 | ) |  |  | (74,959 | )
Net deferred tax assets |  |  | 4,197 |  |  |  | 248 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Intangible amortization |  |  | (225 | ) |  |  | (248 | )
Depreciation |  |  | (29 | ) |  |  | — |
Lease Liability |  |  | (3,943 | ) |  |  | — |
Net deferred tax liabilities |  |  | (4,197 | ) |  |  | (248 | )
Net deferred income taxes |  | $ | — |  |  | $ | — |
Net Operating Losses As of December 31, 2020, the Company had total net operating loss carryforwards for U.S. federal income tax purposes of $462.1 million, of which $126.2 million expire from 2034 through 2037 and $335.9 million do not expire. The Company has net operating loss carryforwards for state income tax purposes of $78.7 million, which expire from 2034 through 2040. The Company is subject to tax in the United States and many state and local jurisdictions. The Company, with certain exceptions, is no longer subject to income tax examinations by U.S. federal, state and local for tax years 2015 and prior. The company is not currently under audit for any US federal or state income tax audits. The Internal Revenue Code (IRC) Section 382 provides for a limitation of the annual use of net operating loss and tax credit carryforwards following certain ownership changes (as defined by the IRC Section 382) that limits the Company’s ability to utilize these carryforwards. The Company completed a Section 382 study to determine the applicable limitation, if any. It was determined that the Company has undergone three ownership changes. There were ownership changes in July 2013, November 2014 and July 2015 which substantially limit the use of the net operating losses generated before the change in control. The Company is still evaluating to see if the shareholder lock-up period expiration in December 2020 associated with the IPO, resulted in a change in control. Uncertain Tax Positions The Company has not identified any uncertain tax positions as of December 31, 2020 or 2019. Any interest and penalties related to uncertain tax positions shall be recorded as a component of income tax expense. To date, no interest or penalties have been accrued in relation to uncertain tax positions.

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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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
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