Income Taxes
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Dec. 31, 2014
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The provision for income taxes for the years ended December 31, 2014, 2013 and 2012 consists of the following:
A reconciliation between income taxes computed at the statutory federal rate and the provision for income taxes for the years ended December 31, 2014, 2013 and 2012 follows:
The tax effects of the significant temporary differences which comprise the deferred income tax assets and liabilities at December 31, 2014 and 2013 are as follows:
Income before income taxes consists of the following U.S. and foreign income:
As of December 31, 2014, the amount of federal net operating loss carryforward was $34.8 million and begins to expire in 2025. Approximately $6.5 million of the net operating loss is attributable to stock-based compensation windfall tax deductions; the windfall tax benefit has not been recorded as a deferred tax asset and will be recorded in additional paid-in-capital when realized. As of December 31, 2014, the amount of federal research credit carryforward available was $6.2 million. These credits begin to expire in 2027. As of December 31, 2014, the amount of foreign tax credit carryforward was $2.3 million and begins to expire in 2023. In New York State, corporate tax reform enacted in March 2014 changed the tax rate of a manufacturing company such as our Company to essentially 0%. Previously recorded New York State net deferred tax assets of $2.3 million, including $3.3 million of future tax benefits associated with state tax credits, have been written off as a non-cash charge to income tax expense. U.S. income and foreign withholding taxes have not been recognized on the excess of the amount for financial reporting over the tax basis of investments in foreign subsidiaries that are essentially permanent in duration. The amount of such temporary differences totaled $92.2 million as of December 31, 2014. It is not practicable given the complexities of the hypothetical foreign tax credit calculation to determine the tax liability on this temporary difference. The Company is subject to taxation in the United States and various states and foreign jurisdictions. Taxing authority examinations can involve complex issues and may require an extended period of time to resolve. Our Federal income tax returns have been examined by the Internal Revenue Service (“IRS”) for calendar years ending through 2013. We recognize tax liabilities in accordance with the provisions for accounting for uncertainty in income taxes. Such guidance prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The following table summarizes the activity related to our unrecognized tax benefits for the years ending December 31,:
If the total unrecognized tax benefits of $0.6 million at December 31, 2014 were recognized, it would reduce our annual effective tax rate. The amount of interest accrued in 2014 related to these unrecognized tax benefits was not material and is included in the provision for income taxes in the consolidated statements of comprehensive income. |