INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2014

Components of income (loss) before income taxes

The components of income before income taxes are as follows (in thousands):



	Year ended December 31,
	2014			2013			2012
United States	$	60,485		$	57,258		$	20,069
Foreign	(1,158		)	(18,250		)	(5,201		)
Income before income tax	$	59,327		$	39,008		$	14,868

Components of income tax benefit

The components of the income tax benefit (expense) are as follows (in thousands):



	Year ended December 31,
	2014			2013			2012
Current income tax benefit (expense):
Federal	$	—		$	226		$	(225	)
State	(2		)	—			—
Foreign	(8,363		)	(6,600		)	(4,994		)
	(8,365		)	(6,374		)	(5,219		)
Deferred income tax (expense) benefit:
Federal	(9,652		)	(16,811		)	—
State	575			(1,192		)	—
Foreign	(31		)	69			11
	(9,108		)	(17,934		)	11
Adjustments to the beginning-of-year valuation allowance	—			59,352			—
Income tax benefit (expense)	$	(17,473	)	$	35,044		$	(5,208	)

Reconciliation of the statutory U.S. federal tax rate to the effective tax rate

Reconciliation of the statutory U.S. federal tax rate to the Company's effective tax rate is as follows:



	Year ended December 31,
	2014		2013		2012
Statutory U.S. federal income tax rate	35.0	%	35.0	%	34.0	%
State income taxes, net of federal benefit	(0.4	)%	(1.3	)%	(2.3	)%
State apportionment change	—	%	0.3	%	23.8	%
U.S. federal rate change	—	%	(3.6	)%	—	%
Effect of foreign operations	0.7	%	10.9	%	7.1	%
Subpart F income	(4.5	)%	15.6	%	—	%
Nondeductible employee compensation	0.5	%	2.3	%	4.2	%
Research tax credits	(2.5	)%	(3.4	)%	—	%
Change in valuation allowance	(0.4	)%	(146.4	)%	(29.3	)%
Other	1.0	%	0.8	%	(2.5	)%
Effective tax rate	29.4	%	(89.8	)%	35.0	%

Tax loss and tax credit carryforwards

The following table summarizes Company tax loss and tax credit carry forwards for tax return purposes at December 31, 2014 (in thousands):



	Related Tax Deduction		Tax Benefit		Expiration Date
Loss carry forwards:
Federal net operating loss	$	22,348	$	7,822	2028 to 2031
Foreign net operating loss	19,315		2,425		n/a
Total loss carry forwards	$	41,663	$	10,247
Tax credit carry forwards:
Research tax credits	n/a		$	12,416	2020 to 2034
Foreign tax credits	n/a		22,076		2020 to 2024
State research tax credits	n/a		2,896		2022 to 2029
Total credit carry forwards	n/a		$	37,388

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This tables includes $72.3 million (tax benefit of $25.8 million) related to excess tax benefits which are not included in deferred tax assets on the consolidated balance sheet and are not recognized until the deduction reduces taxes payable (see below).

Significant components of deferred tax assets

Significant components of the Company's net deferred tax assets and liabilities are as follows (in thousands):



	December 31,
	2014			2013
Deferred tax asset:
Net operating loss carry forwards	$	2,425		$	6,280
Capitalized technology license	2,146			2,519
Capitalized research expenditures	12,227			14,012
Accruals and reserves	3,021			2,172
Retirement plan	3,761			3,315
Deferred revenue	541			1,393
Tax credit carry forwards	19,395			26,965
Stock-based compensation	2,060			1,389
Other	1,589			1,329
	47,165			59,374
Valuation allowance	(12,372		)	(12,598		)
Deferred tax assets	34,793			46,776

Deferred tax liability:
Subpart F income	(3,400		)	(6,070		)
Deferred tax liabilities	(3,400		)	(6,070		)

Net deferred tax assets	$	31,393		$	40,706