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Income Taxes
9 Months Ended
Mar. 31, 2020
Income Taxes  
Income Taxes

(11)  Income Taxes

On March 27, 2020, the President signed the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) into law. While the Company continues to analyze the relevant provisions of the CARES Act, it does not expect the provisions of the legislation to have a significant impact on the Company’s income taxes.

The Company’s quarterly provision for income taxes is based on the annual effective rate method. The Company’s quarterly provision for income taxes also includes the tax impact of certain unusual or infrequently occurring items, if any, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, and other discrete items in the interim period in which they occur.

The Company’s effective tax rate was 23.7% and 16.7% for the three months ended March 31, 2019 and 2020, respectively. The Company’s effective tax rate for the three months ended March 31, 2019 was higher than the federal statutory rate of 21% primarily due to state income taxes and nondeductible expenses, partially offset by federal research and development credits. The Company’s effective tax rate for the three months ended March 31, 2020 was lower than the federal statutory rate of 21% primarily due to federal research and development credits, partially offset by an increase in valuation allowance.

The Company’s effective tax rate was 9.5% and 2.5% for the nine months ended March 31, 2019 and March 31, 2020, respectively. The Company’s effective tax rates for the nine months ended March 31, 2019 and March 31, 2020 were lower than the federal statutory rate of 21% primarily due to excess tax benefits from employee stock-based compensation and federal research and development credits.