Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Summary of provision for income taxes from continuing operations

The provision for income taxes from continuing operations consists of:



	Year ended December 31, (in thousands)
	2017			2016
Current income tax:
Federal	$	—		$	61
State	122			167
Foreign	227			211
	349			439
Deferred income tax:
Federal	4,029			768
State	(381		)	(60		)
	3,648			708
Provision for income taxes	$	3,997		$	1,147

Summary of deferred tax liabilities (assets)

Deferred tax liabilities (assets) are comprised of the following at:



	December 31, (in thousands)
	2017			2016
Deferred tax liabilities:
Software development costs	$	2,119		$	2,223
Acquired intangible assets	913			1,731
Gross deferred tax liabilities	3,032			3,954

Allowances for bad debts and inventory	(2,958		)	(4,505		)
Capitalized inventory costs	(109		)	(104		)
Intangible assets	(672		)	(1,388		)
Employee benefit accruals	(1,282		)	(2,089		)
Federal net operating loss carryforward	(4,941		)	(5,820		)
State net operating loss carryforward	(1,540		)	(1,085		)
Tax credit carryforwards	(6,064		)	(6,888		)
Foreign currency	(33		)	(33		)
Other	(895		)	(1,333		)
Gross deferred tax assets	(18,494		)	(23,245		)

Less valuation allowance	1,653			1,874

Net deferred tax assets	$	(13,809	)	$	(17,417	)

Schedule of effective income tax rate reconciliation

The provision for income taxes differed from the provision computed by applying the Federal statutory rate to income (loss) from continuing operations before taxes due to the following:



	Year ended December 31,
	2017		2016
Federal statutory tax rate	34.0	%	34.0	%
State taxes	(0.9	)	1.4
Non deductible expenses	19.4		2.7
Tax credits	(90.6	)	(6.7	)
Stock based compensation	(69.6	)	—
Foreign income tax rate differential	(14.0	)	(2.1	)
Repatriation Tax	110.5		—
Impact of Tax Cuts and Jobs Act enactment	1,241.0		—
Valuation allowance	—		0.1
Tax return and audit adjustments	(107.3	)	—
Contingent purchase revaluation	(88.0	)	—
Other	(1.7	)	2.0
	1,032.8	%	31.4	%