Income Taxes (Tables)
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12 Months Ended |
Dec. 31, 2022 |
Income Tax Disclosure [Abstract] |
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Income From Continuing Operations Before Income Taxes |
Income from operations before income taxes consisted of the following: | | | | | | | | | | | | | Year Ended December 31, | (in thousands) | 2022 | | 2021 | United States | $ | 910 | | | $ | (6,548) | | Foreign | 12,027 | | | 1,809 | | Total | $ | 12,937 | | | $ | (4,739) | |
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Components of Provision (Benefit) for Income Taxes |
Provision (benefit) for income taxes from operations consisted of the following: | | | | | | | | | | | | | Year Ended December 31, | (in thousands) | 2022 | | 2021 | Current income tax expense: | | | | U.S. federal | $ | 4,011 | | | $ | 3,106 | | U.S. state | 869 | | | 806 | | Foreign | 3,057 | | | 400 | | Total | $ | 7,937 | | | $ | 4,312 | | Deferred income tax expense (benefit): | | | | U.S. federal | $ | (947) | | | $ | (3,324) | | U.S. state | (73) | | | (529) | | Foreign | (1,386) | | | (146) | | Total | $ | (2,406) | | | $ | (3,999) | | Total income tax expense (benefit): | | | | U.S. federal | $ | 3,063 | | | $ | (218) | | U.S. state | 796 | | | 277 | | Foreign | 1,672 | | | 254 | | Total | $ | 5,531 | | | $ | 313 | |
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Reconciliation Between Effective Income Tax Rate and Statutory Federal Rate |
The reconciliation between the effective income tax rates and the statutory federal rates for operations are as follows: | | | | | | | | | | | | | Year Ended December 31, | | 2022 | | 2021 | Statutory Federal rate | 21.0 | % | | 21.0 | % | Increase (decrease) resulting from: | | | | Change in valuation allowance - current period activity | 1.3 | | | (5.5) | | | | | | Foreign rate differential | 4.0 | | | 3.8 | | Stock compensation | (0.5) | | | — | | | | | | State and local taxes, net | 4.5 | | | (4.6) | | | | | | Meals & entertainment | 1.4 | | | (0.7) | | Change in uncertain tax positions | (2.9) | | | — | | | | | | GILTI, Section 78, FDII, and Section 250 | 3.2 | | | (3.3) | | Transaction costs | 8.3 | | | (16.1) | | | | | | | | | | | | | | Earn Out Revaluation | 0.8 | | | — | | | | | | | | | | Other items, net | 1.7 | | | (1.2) | | Provision for income taxes | 42.8 | % | | (6.6) | % |
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Deferred Tax Assets and Liabilities |
Deferred income tax assets and liabilities contain the following temporary differences: | | | | | | | | | | | | | December 31, | (in thousands) | 2022 | | 2021 | Deferred tax assets: | | | | Federal & state NOL carryforward | $ | 8,218 | | | $ | 8,646 | | Research & other credits | — | | | 281 | | Inventory reserve | 6,990 | | | 4,059 | | Transaction costs | 1,620 | | | 1,179 | | Reserves and accruals | — | | | 464 | | Stock based compensation | 2,531 | | | 510 | | Accrued benefits & bonuses | 7,074 | | | 1,218 | | Bad debt reserve | 496 | | | 726 | | Section 163(j) limitation carryforward | 7,692 | | | 5,232 | | ROU liabilities | 11,947 | | | 5,410 | | Deferred state income tax | 745 | | | 93 | | Deferred revenue | 86 | | | 124 | | | | | | Other | 2,822 | | | 81 | | Total deferred tax assets | 50,221 | | | 28,023 | | | | | | Deferred tax liabilities: | | | | Intangible assets and goodwill | 45,951 | | | 16,006 | | ROU asset | 11,295 | | | 5,117 | | Fixed assets | 15,617 | | | 6,685 | | Deferred state income tax | — | | | 119 | | Other | 188 | | | — | | Total deferred liabilities | 73,051 | | | 27,927 | | | | | | Net deferred tax liabilities before valuation allowance | (22,830) | | | 96 | | Valuation allowance | (815) | | | (638) | | Net deferred tax liabilities | $ | (23,645) | | | $ | (542) | |
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Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefits |
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | | | | | | | | | | | | | December 31, | (in thousands) | 2022 | | 2021 | Balance at beginning of year | $ | — | | | $ | — | | Additions for tax positions of current year | 191 | | | — | | Additions for tax positions of prior years | 3,741 | | | — | | Reductions for tax positions of prior year | (238) | | | — | | Lapse of statute of limitations | (667) | | | — | | Balance at end of year | $ | 3,027 | | | $ | — | |
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