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INCOME TAXES
6 Months Ended
Sep. 30, 2018
Income Tax Disclosure [Abstract]  
INCOME TAXES
INCOME TAXES
The Company's effective income tax rates were 9.1% and 45.9% for the three months ended September 30, 2018 and 2017, respectively. Generally, the effective tax rate differs from the statutory tax rate due to the impact of the research and development credit, the impact of state taxes and income generated in jurisdictions that have a different tax rate than the U.S. statutory rate. The effective tax rate for the three months ended September 30, 2018 is lower than the effective rate for the three months ended September 30, 2017, primarily due to the enactment of the Tax Legislation and a significant increase in loss before income tax benefit.
The Company's effective income tax rates were 19.7% and 35.3% for the six months ended September 30, 2018 and 2017, respectively. The effective tax rate for the six months ended September 30, 2018 is lower than the effective rate for the six months ended September 30, 2017, primarily due to the enactment of the Tax Legislation and a significant increase in loss before income tax benefit.
On December 22, 2017, the Tax Legislation was signed into law. The Tax Legislation significantly revises the U.S. tax code by, among other things, lowering the corporate tax rate from 35% to 21%; imposing a minimum tax on certain foreign earnings; limiting the deductibility of interest expense; implementing a territorial tax system and repealing the domestic production activities deduction. In December 2017, the SEC issued Staff Accounting Bulletin No. 118 (SAB 118), which addresses situations where the accounting is incomplete for the income tax effects of the Tax Legislation. SAB 118 directs taxpayers to consider the impact of the Tax Legislation as “provisional” when the Company does not have the necessary information available, prepared or analyzed (including computations) to finalize the accounting for the change in tax law. Companies are provided a measurement period of up to one year to obtain, prepare, and analyze information necessary to finalize the accounting for provisional amounts or amounts that could not be estimated as of December 31, 2017.
The Company continues to assess the impact of the Tax Legislation on its consolidated financial statements. During the three months ended September 30, 2018, the Company decreased its provisional tax expense estimate related to the transition tax associated with the deemed repatriation of foreign earnings by $1.3 million after continued assessment of guidance and recently issued regulations. The Company is still in the process of analyzing the impact of the Tax Legislation, including any potential impact on its indefinite reinvestment assertion.
The Company is subject to the tax on the Global Intangible Low-Taxed Income (GILTI) but has not completed its analysis of the applicability of the tax. As of September 30, 2018, the Company is still evaluating the effects of the GILTI provisions as guidance and interpretations continue to develop. Therefore, the Company will not make a policy election on how to account for GILTI (as part of deferred taxes or as a period expense) until management has received and evaluated the necessary information. However, FASB Accounting Standards Codification 740, Income Taxes (ASC 740) requires that the Company reflects the impact of the GILTI provisions as a period expense until the accounting policy is finalized. Accordingly, the Company has included an estimate of GILTI in its estimated annual effective tax rate and will update the impact and accounting policy once the analysis related to the GILTI provisions is complete.