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Income Taxes | 12 Months Ended
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Dec. 31, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The provision for income taxes was as follows:
(in thousands) |  | Year Ended December 31,
Current: |  | 2020 |  | 2019 |  | 2018
Federal |  | $ | — |  |  | $ | — |  |  | $ | — |
State |  | 72 |  |  | 9 |  |  | 1 |
|  | $ | 72 |  |  | $ | 9 |  |  | $ | 1 |
Deferred: |  |  |  |  |  |
Federal |  | $ | — |  |  | $ | — |  |  | $ | — |
State |  | — |  |  | — |  |  | — |
|  | $ | — |  |  | $ | — |  |  | $ | — |
Provision for income tax |  | $ | 72 |  |  | $ | 9 |  |  | $ | 1 |
The Company has provided a 100% valuation allowance on its deferred tax assets. Provision for income taxes in 2020, 2019 and 2018 is primarily for taxes payable to the states. A reconciliation of income tax expense from continuing operations to the amount computed by applying the statutory federal income tax rate to the net loss from continuing operations is summarized as follows:
|  | Year Ended December 31,
(in thousands) |  | 2020 |  | 2019 |  | 2018
U.S. income tax at federal statutory rate |  | $ | (11,063) |  |  | $ | (2,611) |  |  | $ | (6,276) |
State income tax, net of federal benefits |  | (1,962) |  |  | (2,550) |  |  | (1,072) |
Foreign rate differential |  | (54) |  |  | — |  |  | — |
Stock warrant liability |  | — |  |  | 2,626 |  |  | — |
Share-based compensation |  | (21,007) |  |  | (21,236) |  |  | (615) |
Research and development credits |  | (10) |  |  | (8) |  |  | (6) |
Return to provision and other |  | — |  |  | — |  |  | 29 |
Change in tax rates |  | 2,989 |  |  | 73 |  |  | 668 |
Other |  | 529 |  |  | (98) |  |  | 363 |
Change in valuation allowance |  | 30,650 |  |  | 23,813 |  |  | 6,910 |
Provision for income tax |  | $ | 72 |  |  | $ | 9 |  |  | $ | 1 |
Significant components of the Company's deferred tax assets and liabilities as of December 31, 2020, and 2019 are shown below. A valuation allowance has been recorded to offset the net deferred tax assets as of December 31, 2020 and 2019, as the realization of such assets does not meet the more-likely-than-not threshold.
|  | December 31,
(in thousands) |  | 2020 |  | 2019
Deferred Tax Assets: |  |  |  |
Net operating loss (NOL) |  | $ | 78,464 |  |  | $ | 50,663 |
Intangibles |  | 1,495 |  |  | 1,252 |
Share-based compensation |  | 3,295 |  |  | 2,704 |
Interest |  | 311 |  |  | — |
Inventory reserve |  | 2,262 |  |  | 1,509 |
Other |  | 2,024 |  |  | 204 |
Total gross deferred tax assets |  | 87,851 |  |  | 56,332 |
Deferred Tax liabilities: |  |  |  |
Property, plant and equipment |  | 1,773 |  |  | 904 |
Other |  | — |  |  | — |
Total gross deferred tax liabilities |  | 1,773 |  |  | 904 |
Valuation allowance |  | 86,078 |  |  | 55,428 |
Net deferred tax assets (liabilities) |  | $ | — |  |  | $ | — |
As of December 31, 2020, and 2019, management assessed the realizability of deferred tax assets and evaluated the need for an amount of a valuation allowance for deferred tax assets on a jurisdictional basis. This evaluation utilizes the framework contained in ASC 740, Income Taxes, pursuant to which management analyzed all positive and negative evidence available at the balance sheet date to determine whether all or some portion of the deferred tax assets will not be realized. Under this guidance, a valuation allowance must be established for deferred tax assets when it is more likely than not (a probability level of more than 50%) that they will not be realized. In concluding on the evaluation, management placed significant emphasis on guidance in ASC 740, which states that “a cumulative loss in recent years is a significant piece of negative evidence that is difficult to overcome.” Based upon available evidence, it was concluded on a more-likely-than-not basis that certain deferred tax assets were not realizable as of December 31, 2020. Accordingly, a valuation allowance of $86.1 million has been recorded to offset these deferred tax assets. The change in valuation allowance for the year ended December 31, 2020 from 2019 was an increase of $30.7 million. As of December 31, 2019, the Company has accumulated federal and state net operating loss carryforwards of approximately $209.5 million and $143.8 million, respectively. As of December 31, 2020, the Company has accumulated federal, state and foreign net operating loss carryforwards of approximately $344.2 million, $92.5 million and $1.3 million, respectively. Approximately $252.4 million of the federal net operating losses do not expire and the remaining federal, state and foreign tax loss carryforwards begin to expire in 2031, 2032 and 2025 respectively, unless previously utilized. Pursuant to Internal Revenue Code (IRC) Sections 382 and 383, annual use of the Company's net operating loss (NOLs) and research and development credit carryforwards may be limited in the event a cumulative change in ownership of more than 50% occurs within a three-year period. The Company has completed a section 382 analysis through December 31, 2019 and concluded ownership changes occurred in 2011, 2013 and 2015. However, these ownership changes are not expected to result in a material limitation on future use of the Company’s NOLs and credit carryforwards generated prior to these ownership changes pursuant. Changes may have occurred in 2020 and may occur in the future that could limit the Company's ability to utilize tax attributes. Any adjustment to the Company's tax attributes as a result of such ownership changes will result in a corresponding decrease to the valuation allowance recorded against the Company's deferred tax assets. The following table summarizes the activity related to the Company’s gross unrecognized tax benefits at the beginning and end of the years ended December 31, 2020 and 2019:
|  | Year Ended December 31,
|  | 2020 |  | 2019
Gross unrecognized tax benefits at the beginning of the year |  | $ | 3,336 |  |  | $ | 1,846 |
Increases related to current year positions |  | 2,063 |  |  | 1,695 |
Increases/Decreases related to prior year positions |  | — |  |  | (205) |
Gross unrecognized tax benefits at the end of the year |  | $ | 5,399 |  |  | $ | 3,336 |
As of December 31, 2020 and 2019, the Company had $4.9 million and $3.1 million, respectively, of unrecognized tax benefits from research and development tax credits, none of which, if recognized, would affect the Company’s effective tax rate. The Company recognizes interest and penalties accrued related to unrecognized tax benefits in income tax expense. During the years ended December 31, 2020, 2019 and 2018, interest and penalties recognized were insignificant. The Company does not expect any significant increases or decreases to its unrecognized tax benefits within the next 12 months. The Company files U.S. federal and state income tax returns in jurisdictions with varying statute of limitations. The Company’s tax years from 2011 (inception) are subject to examination by the United States and state authorities due to the carry forward of unutilized net operating losses and research and development credits. With respect to the income of its foreign subsidiaries, The Company takes the position that the undistributed earnings of its foreign subsidiaries are permanently invested in that jurisdiction. As a result, no additional income taxes have been provided on the possible repatriation of these earnings to the parent company. The Company does not have any unremitted earnings as of December 31, 2020.

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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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