Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

Schedule of components of income tax expense (benefit)

Income tax expense (benefit) for the years ended December 31, 2022 and 2021 attributable to loss from continuing operations is presented below.


	Current		Deferred		Total
Year ended December 31, 2022
Federal	$	404	$	—	$	404
State	(13)		—		(13)
Foreign	500		(345)		155
	$	891	$	(345)	$	546
Year ended December 31, 2021
Federal	$	27	$	—	$	27
State	—		—		—
Foreign	44		(179)		(135)
	$	71	$	(179)	$	(108)

Schedule of effective income tax rate reconciliation

Actual income tax expense (benefit) differs from the “expected” income tax expense (benefit) computed by applying the United States Federal statutory income tax rate of 21% for both 2022 and 2021 to loss from continuing operations before tax (benefit) expense, as follows:


	Year Ended December 31,
	2022		2021
Income tax benefit at Federal statutory income tax rate	$	(710)	$	(2,447)
Increase (decrease) in income taxes resulting from:
State income tax benefit, net of federal benefit	(17)		(386)
State research and development, investment credits	265		(137)
Non-deductible meals & entertainment	8		1
Non-deductible stock compensation expense	133		(194)
Non-deductible compensation under 162(m)	7		35

Prior Period Prepaid Tax	276		—
Foreign Withholding Taxes	139		—
Foreign tax rate differential	(3)		58
Federal research and development credits	(55)		(607)
Uncertain tax positions	(99)		32
Provision to tax return adjustments	110		33
Change in valuation allowance	530		5,066
PPP loan forgiveness	—		(1,455)

Sale of KVH Media Group Entertainment Limited	(206)		—

Prior period adjustments	—		(117)
Other	168		10
Income tax expense (benefit)	$	546	$	(108)

Schedule of loss before income tax, domestic and foreign

Loss from continuing operations before income tax expense (benefit) determined by tax jurisdiction, are as follows:


	Year Ended December 31,
	2022		2021
United States	$	(4,616)	$	(11,823)
Foreign	1,238		169
Total	$	(3,378)	$	(11,654)

Schedule of deferred tax assets and liabilities

Deferred tax assets and liabilities for the periods presented consisted of the following:


	December 31,
	2022		2021
Deferred tax assets:
Accounts receivable, due to allowance for doubtful accounts	$	221	$	364
Inventories	1,335		858
Operating loss carry-forwards	4,546		5,784
Stock-based compensation expense	881		1,106
Property and equipment, due to difference in depreciation	283		1,944
Research and development tax credit carry-forwards	5,743		6,247
Foreign tax credit carry-forwards	2,345		2,345
State tax credit carry-forwards	3,710		3,975
Capitalized research and development	5,003		2,690
Warranty reserve	302		255
Accrued expenses	1,486		1,089
Lease liability	483		700
Gross deferred tax assets	26,338		27,357
Less valuation allowance	(22,094)		(26,542)
Total deferred tax assets	4,244		815
Deferred tax liabilities:
Purchased intangible assets	(39)		(199)
Property and equipment, due to differences in depreciation	(3,514)		(86)
Right of use asset	(487)		(689)

Total deferred tax liabilities	(4,040)		(974)
Net deferred tax asset (liability)	$	204	$	(159)
Deferred income tax asset	$	259	$	56
Deferred income tax liability	$	(55)	$	(215)

Summary of positions for which significant change in unrecognized tax benefits is reasonably possible

The aggregate changes in the total gross amount of unrecognized tax benefits, excluding penalties and interest, are as follows:


	Year Ended December 31,
	2022		2021
Unrecognized tax benefits as of January 1	$	1,653	$	1,771
Gross decrease in unrecognized tax benefits - prior year tax positions	(160)		(104)

Lapse of statute of limitations	(11)		(14)
Unrecognized tax benefits as of December 31	$	1,482	$	1,653