XML 27 R14.htm IDEA: XBRL DOCUMENT
v3.22.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | H. Income Taxes The Company periodically undertakes a review of its valuation allowance and evaluates all positive and negative factors that may affect whether it is more likely than not that the Company would realize its future tax benefits from its deferred tax balances. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become realizable. During 2021, the Company released its valuation allowance over a portion of its deferred tax assets as the deferred tax assets became more likely than not to be realized. Income tax provision (benefit) for the years ended December 31, 2021 and 2020 is as follows:
|  | 2021 |  |  | 2020 |
|  | (in thousands) |
Current: |  |  |  |  |  |  |  |
Federal |  | $ | 860 |  |  | $ | — |
State and local |  |  | 116 |  |  |  | 31 |
Foreign |  |  | — |  |  |  | 50 |
Total Current |  |  | 976 |  |  |  | 81 |
Deferred: |  |  |  |  |  |  |  |
Federal |  |  | 3,188 |  |  |  | 238 |
State and local |  |  | 332 |  |  |  | (6 | )
Foreign |  |  | 1 |  |  |  | 32 |
Total before change in valuation allowance |  |  | 3,521 |  |  |  | 264 |
Change in valuation allowance |  |  | (379 | ) |  |  | (9 | )
Net deferred |  |  | 3,142 |  |  |  | 255 |
Income tax provision |  | $ | 4,118 |  |  | $ | 336 |
A reconciliation of the provision (benefit) for income taxes and the amount computed by applying the statutory federal income tax rate to income before income taxes is detailed below:
|  | 2021 |  |  | 2020 |
|  | (in thousands) |
Tax provision at expected statutory rate |  | $ | 3,939 |  |  | $ | 274 |
State taxes, net of federal benefit |  |  | 448 |  |  |  | 31 |
Permanent differences |  |  | (271 | ) |  |  | 45 |
Tax credits |  |  | (116 | ) |  |  | (125 | )
Tax credit expiration |  |  | — |  |  |  | 132 |
Foreign tax expense, and other |  |  | (7 | ) |  |  | 1 |
Change in rate |  |  | — |  |  |  | (38 | )
Change in valuation allowance |  |  | (379 | ) |  |  | (9 | )
Change in uncertain tax positions |  |  | 458 |  |  |  | — |
Provision to return |  |  | 13 |  |  |  | 15 |
Other |  |  | 33 |  |  |  | 10 |
Provision for income taxes |  | $ | 4,118 |  |  | $ | 336 |
Effective tax rate |  |  | 22.0 | % |  |  | 25.8 | %
Deferred income taxes for 2021 and 2020 were provided for the temporary differences between the financial reporting basis and the income tax basis of the Company's assets and liabilities. Tax effects of temporary differences and carryforwards at December 31, 2021 and 2020 were as follows:
|  | December 31, 2021 |  |  | December 31, 2020 |
|  | Deferred Tax |  |  | Deferred Tax |
|  | Asset |  |  | Liability |  |  | Asset |  |  | Liability |
|  | (in thousands) |
Inventory reserve |  | $ | 345 |  |  | $ | — |  |  | $ | 286 |  |  | $ | — |
Fixed assets |  |  | — |  |  |  | 44 |  |  |  | — |  |  |  | 58 |
Other reserves and accruals |  |  | 262 |  |  |  | — |  |  |  | 338 |  |  |  | — |
Unrealized gains on marketable securities |  |  | — |  |  |  | 1,024 |  |  |  | — |  |  |  | 27 |
Stock-based compensation |  |  | 2 |  |  |  | — |  |  |  | 8 |  |  |  | — |
Other |  |  | — |  |  |  | 6 |  |  |  | — |  |  |  | 12 |
Tax credit carryforwards |  |  | 318 |  |  |  | — |  |  |  | 1,717 |  |  |  | — |
Federal tax loss carryforwards |  |  | — |  |  |  | — |  |  |  | 892 |  |  |  | — |
State tax loss carryforwards |  |  | 23 |  |  |  | — |  |  |  | 252 |  |  |  | — |
Foreign tax loss carryforwards |  |  | 34 |  |  |  | — |  |  |  | 35 |  |  |  | — |
Total deferred income taxes |  |  | 984 |  |  | $ | 1,074 |  |  |  | 3,528 |  |  | $ | 97 |
Valuation allowance |  |  | — |  |  |  |  |  |  |  | (379 | ) |  |  |  |
Net deferred tax (liabilities) assets |  | $ | (90 | ) |  |  |  |  |  | $ | 3,052 |  |  |  |  |
Deferred tax liability totaled $90,000 at December 31, 2021 which includes the tax effect of state and foreign NOL carryforwards. We recognize federal, state and foreign NOL carryforwards and our federal tax credits as deferred tax assets, subject to any required valuation allowance. Significant judgment is required in determining our worldwide provision for income taxes. In the ordinary course of a global business, there are many transactions for which the ultimate tax outcome is uncertain. We review our tax contingencies on a regular basis and make appropriate accruals as necessary. As of December 31, 2021, our unrecognized tax benefits totaled $458,000, and are included within other liabilities in our consolidated balance sheet. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
|  | 2021 |
|  | (in thousands) |
Balance at January 1 |  | $ | — |
Additions for tax positions of prior years |  |  | 429 |
Additions based on tax positions related to the current year |  |  | 29 |
Balance at December 31 |  | $ | 458 |
The Company will recognize any interest and penalties related to unrecognized tax positions in income tax expense. Net adjustments to accruals for interest and penalties associated with uncertain tax positions was immaterial for 2021. Our total accrued interest and penalties associated with uncertain tax positions were immaterial as of December 31, 2021. The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate is $458,000. We do not expect a significant change to the amount of unrecognized tax benefits over the next 12 months. We believe that the taxes accrued in our consolidated balance sheet fairly represent the amount of income taxes to be settled or realized in the future. The Company files income tax returns in the U.S. federal, various state, Hong Kong and India jurisdictions. The statute of limitations for assessment by the Internal Revenue Service ("IRS") and state tax authorities is open for tax returns for years ended December 31, 2018, 2019 and 2020; although carryforward attributes that were generated prior to tax year 2018, including NOL carryforwards and tax credits, may still be adjusted upon examination by the IRS or state tax authorities, if they either have been or will be used in a future period. The Company is generally subject to examinations by foreign tax authorities from 2016 to the present.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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=121826272&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=122134291&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=121826272&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=122134291&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=121826272&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 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration