INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Schedule of components of income tax expense

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

	Year Ended December 31,
	2019			2018		2017
Domestic	$	(1,872	)	$	3,602	$	18,188
Foreign	(711		)	205		181
	$	(2,583	)	$	3,807	$	18,369

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

	Year Ended December 31,
	2019			2018			2017
Current income tax expense:
Federal	$	—		$	(115	)	$	—
State	189			192			6
Foreign	170			63			43
Total current expense	$	359		$	140		$	49
Deferred income tax (benefit) expense:
Federal	$	(1,610	)	$	(1,877	)	$	9,736
State	(307		)	(378		)	(872		)
Foreign	112			—			—
Total deferred (benefit) expense	(1,805		)	(2,255		)	8,864
Total income tax (benefit) expense	$	(1,446	)	$	(2,115	)	$	8,913

Temporary differences to the components of deferred tax assets

Temporary differences that give rise to the components of net deferred tax assets are as follows (in thousands):

	December 31,
	2019			2018
Inventory	$	2,005		$	1,249
Accrued compensation	122			110
Stock options	1,858			1,281
Research and development	990			476
Legal settlement	—			1,678
Research and development expense	1,417			—
Deferred revenue	2,052			3,305
Property and equipment	3,469			3,065
Net operating loss carryforwards	11,676			17,088
Foreign tax credit carryforward	64			38
Sales-type leases	(1,968		)	(3,936		)
Convertible debt equity component	(9,421		)	—
Foreign intangible	(691		)	—
Other	(179		)	—
	11,394			24,354
Valuation allowance	(5,656		)	(10,233		)
Total net deferred tax assets	$	5,738		$	14,121

Effective income tax rate

The Company's income tax (benefit) expense relating to income (loss) for the periods presented differs from the amounts that would result from applying the federal statutory rate to that income (loss) as follows:

	Year Ended December 31,
	2019		2018		2017
Statutory federal tax rate	21	%	21	%	34	%
State income taxes, net of federal benefit	9	%	(8	)%	(5	)%
Non-controlling interest in Heska Imaging US, LLC	—	%	—	%	1	%
Non-controlling interest in Optomed	(2	)%	—	%	—	%
Non-temporary stock option benefit	48	%	(50	)%	(30	)%
Meals and entertainment permanent difference	(2	)%	1	%	—	%
GILTI permanent difference	2	%	1	%	—	%
Other permanent differences	(1	)%	1	%	1	%
Foreign tax rate differences	6	%	—	%	—	%
Change in tax rate	(6	)%	—	%	32	%
Change in valuation allowance	(17	)%	—	%	16	%
Other deferred differences	(9	)%	(21	)%	—	%
Transaction costs	(6	)%	—	%	—	%
Executive compensation limit	(7	)%	—	%	—	%
Research & development credit	20	%	—	%	—	%
Other	—	%	(1	)%	—	%
Effective income tax rate	56	%	(56	)%	49	%