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Income Tax Provision | 12 Months Ended
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Mar. 31, 2020
Income Tax Disclosure [Abstract] |
Income Tax Provision | Note 16 — Income Tax Provision On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was enacted in the United States. The CARES Act provides numerous tax provisions and other stimulus measures, including temporary changes regarding the prior and future utilization of net operating losses and technical corrections from prior tax legislation for tax depreciation of certain qualified improvement property. The Company evaluated the provisions of the CARES Act and does not anticipate the associated impacts, if any, will have a material effect on its financial position. The Company's income tax provision can be affected by many factors, including the overall level of pre-tax income, the mix of pre-tax income generated across the various jurisdictions in which the Company operates, changes in tax laws and regulations in those jurisdictions, , changes in valuation allowances on its deferred tax assets, tax planning strategies available to the Company, and other discrete items. The components of pretax loss and income tax (benefit) expense are as follows (in thousands):
|  | Year Ended March 31, |
|  | 2020 |  |  | 2019 |
Loss before income taxes: |  |  |  |  |  |
Domestic |  | $ | (39,119 | ) |  | $ | (37,544 | )
Foreign |  |  | - |  |  |  | - |
Total loss before income taxes |  | $ | (39,119 | ) |  | $ | (37,544 | )
The provision for income taxes consisted of the following: |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  |  |
U.S. Federal |  | $ | - |  |  | $ | - |
State |  |  | 18 |  |  |  | 7 |
Foreign |  |  | - |  |  |  | - |
Total Current |  |  | 18 |  |  |  | 7 |
Deferred: |  |  |  |  |  |  |  |
U.S. Federal |  |  | (96 | ) |  |  | - |
State |  |  | (114 | ) |  |  | 211 |
Foreign |  |  | - |  |  |  | - |
Total Deferred |  |  | (210 | ) |  |  | 211 |
Total provision for income taxes |  | $ | (192 | ) |  | $ | 218 |
The differences between income taxes expected at U.S. statutory income tax rates and the income tax provision are as follows (in thousands):
|  | Year Ended March 31, |
|  | 2020 |  |  | 2019 |
Income taxes computed at Federal statutory rate |  | $ | (8,214 | ) |  | $ | (7,884 | )
State tax — net of federal benefit |  |  | (839 | ) |  |  | (1,555 | )
State minimum taxes |  |  | 18 |  |  |  | 7 |
Change in tax rates |  |  | 926 |  |  |  | - |
Change in valuation allowance |  |  | 5,959 |  |  |  | 8,987 |
Permanent differences |  |  | 1,958 |  |  |  | 663 |
Total provision for income taxes |  | $ | (192 | ) |  | $ | 218 |
At March 31, 2020, the Company had available federal and state net operating loss carryforwards to reduce future taxable income of approximately $89.0 million and $72.7 million, respectively. The federal and state net operating loss carryforwards begin to expire on various dates beginning in 2024. Of the $89.0 million of federal net operating loss carryforwards, $50.6 million was generated in tax years beginning before March 31, 2018 and is subject to the 20-year carryforward period ("pre-Tax Act losses"), the remaining $38.4 million ("post-Tax Act losses") can be carried forward indefinitely but is subject to the 80% taxable income limitation. The Company obtained $136 million and $2.6 million of net operating loss and credit carryforwards, respectively, through the acquisition of Slacker, Inc. in December 2017. Utilization of these losses is limited by Section 382 and 383 of the Code in fiscal year end March 31, 2018 and each taxable year thereafter. The Company has estimated a limitation and revalued the losses and credits at $22 million and $0, respectively. It is possible that the utilization of these NOL carryforwards and tax credits may be further limited. The Company is undertaking a study to determine the applicable limitations, if any. Upon the attainment of taxable income by the Company, management will assess the likelihood of realizing the tax benefit associated with the use of the carryforwards and will recognize the appropriate deferred tax asset at that time. The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by the federal and state jurisdictions where applicable. There are currently no pending income tax examinations. The Company's tax years for 2015 and forward are subject to examination by the federal tax authorities and tax years for 2014 and forward are subject to examination by California tax authorities due to the carryforward of unutilized net operating losses. The Company's policy is to record interest and penalties on uncertain tax provisions as income tax expense. As of March 31, 2020 and 2019, the Company has not accrued interest or penalties related to uncertain tax positions. Significant components of the Company's deferred income tax assets and liabilities are as follows as of (in thousands):
|  | Year Ended March 31, |
|  | 2020 |  |  | 2019 |
Deferred tax assets: |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 20,370 |  |  | $ | 18,005 |
Property and equipment |  |  | 190 |  |  |  | 135 |
Accruals and reserves |  |  | 716 |  |  |  | 796 |
Stock compensation |  |  | 4,845 |  |  |  | 3,154 |
163 (j) interest expense carryforwards |  |  | 378 |  |  |  | - |
Charitable contribution carryforward |  |  | 7 |  |  |  | - |
Capital loss carryforward |  |  | 509 |  |  |  | 556 |
Gross deferred tax assets |  |  | 27,015 |  |  |  | 22,646 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Intangible assets |  |  | (5,032 | ) |  |  | (6,832 | )
Net deferred tax assets |  |  | 21,983 |  |  |  | 15,814 |
Valuation allowance |  |  | (22,091 | ) |  |  | (16,025 | )
Net deferred tax liability |  | $ | (108 | ) |  | $ | (211 | )
As the ultimate realization of the potential benefits of the Company's deferred tax assets is considered unlikely by management, the Company has offset the deferred tax assets attributable to those potential benefits through valuation allowances. Accordingly, the Company did not recognize any benefit from income taxes in the accompanying Consolidated Statements of Operations to offset its pre-tax losses. The valuation allowance is $22.1 million and $16.0 million for the years ended March 31, 2020 and 2019, respectively.

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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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