Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Schedule of Income (Loss) Before Income Taxes

Income (loss) before income taxes from continuing operations relate to the following jurisdictions (in thousands):



	Years Ended December 31,
	2017			2016			2015
United States	$	(6,502	)	$	(5,306	)	$	(244	)
Foreign	14,020			8,777			2,152
	$	7,518		$	3,471		$	1,908

Schedule of Provision for Income Taxes

The provision for income taxes for continuing operations consists of the following (in thousands):



	Years Ended December 31,
	2017			2016			2015
Current:
Federal	$	—		$	—		$	—
State	1			—			(13		)
Foreign	2,230			2,103			1,494
	2,231			2,103			1,481
Deferred:
Federal	(155		)	—			—
State	—			—			—
Foreign	886			(861		)	(1,112		)
	731			(861		)	(1,112		)
Total	$	2,962		$	1,242		$	369

Schedule of Significant Differences Between the U.S. Federal Statutory Tax Rate and the Effective Income Tax Expense

The significant differences between the U.S. federal statutory tax rate and the Company’s effective income tax expense for earnings (in thousands) are as follows:



	Years Ended December 31,
	2017			2016			2015
Statutory federal income tax rate	$	2,631		$	1,180		$	649
State income taxes, net of federal effect	(62		)	(173		)	(240		)
Net operating loss limitation	2,975			—			—
Deferred tax true-up	—			(4,103		)	8,078
Change in deferred tax asset valuation allowance	(15,338		)	4,877			(6,729		)
Statutory rate change	13,850			—			—
Foreign tax rate differential	(899		)	(712		)	(223		)
Compensation deduction limitation	—			113			(1,201		)
Other, net	(195		)	60			35
Total	$	2,962		$	1,242		$	369

Schedule of the Tax Effects of Temporary Differences and Carry-Forwards That Give Rise to Deferred Tax Assets and Liabilities

The tax effects of temporary differences and carry-forwards that give rise to deferred tax assets and liabilities consist of the following (in thousands):



	Years Ended December 31,
	2017		2016
Deferred income tax assets:
Accounts payable and accrued expenses	$	1,215	$	737
Accrued payroll and related expenses	1,691		3,062
Stock-based compensation expense	3,508		3,531
Depreciation of property and equipment	1,711		2,579
Capitalized Software	—		—
Non-compete agreements	—		—
Unbilled receivables and refund liabilities	1,811		2,216
Operating loss carry-forwards of foreign subsidiary	11,000		10,907
Federal operating loss carry-forwards	17,161		33,087
State operating loss carry-forwards	3,591		3,919
Other	376		1,181
Gross deferred tax assets	42,064		61,219
Less valuation allowance	34,776		50,114
Gross deferred tax assets net of valuation allowance	7,288		11,105
Deferred income tax liabilities:
Intangible assets	1,987		2,299
Capitalized software	29		1,928
Other	3,734		4,609
Gross deferred tax liabilities	5,750		8,836
Net deferred tax assets	$	1,538	$	2,269

Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits and Related Accrued Interest

A reconciliation of our beginning and ending amount of unrecognized tax benefits and related accrued interest thereon is as follows:



	Unrecognized Tax Benefits			Accrued Interest and Penalties
Balance at January 1, 2015	$	677		$	220
Additions based on tax positions related to the current year	—			—
Additions based on tax positions related to the prior years	—			24
Decrease based on payments made during the year	—			—
Decreases based on tax positions related to the prior years	$	(142	)	$	(42	)
Balance at December 31, 2015	$	535		$	202
Additions based on tax positions related to the current year	—			—
Additions based on tax positions related to the prior years	—			11
Decreases based on payments made during the year	—			—
Decreases based on tax positions related to the prior years	(38		)	(59		)
Balance at December 31, 2016	$	497		$	154
Additions based on tax positions related to the current year	—			—
Additions based on tax positions related to the prior years	116			19
Decreases based on payments made during the year	—			—
Decreases based on tax positions related to the prior years	(420		)	(145		)
Balance at December 31, 2017	$	193		$	28