Schedule of Components of Income Tax Expense (Benefit) |
The components of our income tax expense are as follows (in thousands): | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | 2021 | | 2020 | | 2019 | Current | | | | | | Federal | $ | 2,678 | | | $ | 3,583 | | | $ | 1,615 | | State | 1,437 | | | 2,735 | | | 900 | | Foreign | 894 | | | 438 | | | 452 | | Total Current | 5,009 | | | 6,756 | | | 2,967 | | Deferred | | | | | | Federal | (9,295) | | | (3,628) | | | 2,622 | | State | (820) | | | 372 | | | (23) | | Foreign | — | | | — | | | — | | Total Deferred | (10,115) | | | (3,256) | | | 2,599 | | Total | $ | (5,106) | | | $ | 3,500 | | | $ | 5,566 | |
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Schedule of Effective Income Tax Rate Reconciliation |
The difference between the income tax expense at the federal statutory rate and income tax expense in the consolidated statements of operations is as follows: | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | 2021 | | 2020 | | 2019 | Federal statutory rate | 21.0 | % | | 21.0 | % | | 21.0 | % | State income tax expense, net of federal benefits | (1.0) | | | 1.4 | | | 0.6 | | Nondeductible meals and entertainment | 0.5 | | | 0.1 | | | 0.8 | | | | | | | | Foreign-derived intangible income deduction | (1.7) | | | (1.4) | | | (0.7) | | Valuation allowance | 1.1 | | | 1.3 | | | — | | Research and development tax credits | (17.7) | | | (9.4) | | | (7.1) | | Tax windfall benefits | (18.8) | | | (8.8) | | | (7.5) | | | | | | | | Change in tax rate | — | | | (0.2) | | | 0.4 | | Foreign withholding tax | 1.9 | | | 0.5 | | | 0.8 | | Nondeductible compensation | 1.9 | | | — | | | — | | Other | 1.7 | | | (0.1) | | | 1.2 | | Effective rate | (11.1) | % | | 4.4 | % | | 9.5 | % |
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Schedule of Components of Deferred Tax Assets and Liabilities |
The components of our net deferred tax assets (liabilities) are as follows (in thousands): | | | | | | | | | | | | | December 31, | | 2021 | | 2020 | Deferred tax assets, non-current | | | | Provision for credit losses on accounts receivable | $ | 847 | | | $ | 1,524 | | Depreciation | 281 | | | 261 | | | | | | Accrued expenses | 4,749 | | | 4,633 | | Deferred revenue | 2,061 | | | 1,725 | | Operating lease liabilities | 10,619 | | | 11,511 | | | | | | Stock-based compensation | 15,461 | | | 12,768 | | Acquisition costs | 2,627 | | | 2,773 | | Subsidiary unit compensation | 804 | | | 249 | | Equity investments | — | | | 31 | | Inventory reserve | 439 | | | 240 | | Debt issuance costs | 402 | | | — | | Net operating losses | 1,262 | | | 1,198 | | Tax credits | 9,405 | | | 5,502 | | | | | | Other | 577 | | | 288 | | Total deferred tax assets, non-current prior to valuation allowance | 49,534 | | | 42,703 | | Valuation allowance | (2,209) | | | (1,568) | | Total deferred tax assets, non-current, net of valuation allowance | 47,325 | | | 41,135 | | Deferred tax liabilities, non-current | | | | Intangible assets and prepaid patent licenses | (2,905) | | | (4,421) | | Operating lease right-of-use assets | (7,534) | | | (8,043) | | Depreciation | (6,446) | | | (5,322) | | Sales commissions | (896) | | | (866) | | Contingent liability | — | | | (171) | | Internally developed software | (147) | | | (620) | | Equity investments | (92) | | | — | | Convertible debt discount | (15,758) | | | — | | Total deferred tax liabilities, non-current | (33,778) | | | (19,443) | | Net deferred tax assets, non-current | $ | 13,547 | | | $ | 21,692 | |
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Schedule of Unrecognized Tax Benefits Roll Forward |
A reconciliation of the beginning and ending amounts of unrecognized tax benefits (without related interest expense) is as follows (in thousands): | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | 2021 | | 2020 | | 2019 | Beginning balance | $ | 4,228 | | | $ | 3,065 | | | $ | 2,801 | | Additions based on tax positions of the current year | 1,526 | | | 1,166 | | | 718 | | Additions based on tax positions of prior year | 15 | | | 656 | | | 18 | | Decreases based on tax positions of prior year | (10) | | | (259) | | | (253) | | | | | | | | Decreases due to lapse of applicable statute of limitations | (218) | | | (400) | | | (219) | | Ending balance | $ | 5,541 | | | $ | 4,228 | | | $ | 3,065 | |
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