Tax Provision

3 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

Tax Provision

13. Tax Provision

The Company’s income tax provision for interim periods is determined using an estimate of the annual effective tax rate, adjusted for discrete items arising during that interim period. The Company’s effective tax rate differs from the U.S. statutory tax rate primarily due to the recording of a foreign tax provision related to its Australian subsidiary. The Company continues to maintain a full valuation allowance for its U.S. federal and state deferred tax assets. The Company’s effective tax rate for the three months ended March 31, 2023 and 2022 was (0.50%) and (0.42%), respectively. During the three months ended March 31, 2023 and 2022, the Company recorded an income tax expense of $0.1 million in each period.

The Company previously recognized a reserve related to a foreign uncertain tax position related to its Australian subsidiary. For each of the three months ended March 31, 2023 and 2022 the Company recorded an insignificant amount of interest expense as a component of income tax expense related to this uncertain tax position.

Income taxes are determined at the applicable tax rates adjusted for non-deductible expenses, research and development tax credits and other permanent differences. The Company’s income tax provision may be significantly affected by changes to its estimates.