Income Taxes

6 Months Ended

Sep. 30, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Note 14. Income Taxes

The Company’s income tax provision was $32.6 million and $10.3 million for the three months ended September 30, 2022 and 2021, respectively. The Company’s income tax provision was $47.8 million and $27.5 million for the six months ended September 30, 2022 and 2021, respectively. The Company’s effective income tax rate was 23.5% and 15.3% for the three months ended September 30, 2022 and 2021, respectively. The Company’s effective income tax rate was 22.9% and 47.5% for the six months ended September 30, 2022 and 2021, respectively. The effective income tax rate differs from the statutory federal income tax rate of 21.0% for the three months ended September 30, 2022 primarily due to state and foreign income taxes and permanent differences, offset by credits. The effective income tax rate differs from the statutory federal income tax rate of 21.0% for the three months ended September 30, 2021 primarily due to state and foreign income taxes and permanent differences, offset by credits and excess tax benefits. The effective income tax rate differs from the statutory federal income tax rate of 21.0% for the six months ended September 30, 2022 and 2021 primarily due to state and foreign income taxes and permanent differences offset by credits and excess tax benefits and the non-deductible charge for in-process research and development related to the preCARDIA acquisition for the six months ended September 30, 2021. The Company recognized shortfall expenses associated with stock-based awards of less than $0.1 million and excess tax benefits associated with stock-based awards of $6.2 million for the three months ended September 30, 2022 and 2021, respectively. The Company recognized excess tax benefits associated with stock-based awards of $0.9 million and $9.8 million for the six months ended September 30, 2022 and 2021, respectively.

The Company is subject to the examination of its income tax returns by the Internal Revenue Service and other tax authorities. The outcome of these audits cannot be predicted with certainty. The Company’s most recent completed income tax audits were in the U.S., relating to fiscal year 2016 and in Germany, which covered fiscal years 2016 through 2019. These tax audits did not materially impact the Company’s financial statements. All other tax years remain subject to examination by the IRS, state and foreign tax authorities.

On August 16, 2022, the Inflation Reduction Act (“IRA”) was signed into law, effective as of January 1, 2023. The IRA includes a new alternative minimum tax based upon financial statement income (book minimum tax), an excise tax on stock buybacks and tax incentives for energy and climate initiatives, among other provisions. We do not currently expect the legislation will have a material effect on our results of operations, financial condition or liquidity.