Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The (benefit) provision for income taxes shown in the statement of operations is net of $3, $4, $4 and $2 for minimum state taxes for the years ended December 31, 2015, the transition period, fiscal 2014, and fiscal 2013, respectively. A reconciliation of income taxes at the U.S. federal statutory rate to the benefit for income taxes is as follows:
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets were as follows:
United States federal and state net operating losses of $10,300 represent excess tax benefits from the exercise of share based awards which will be recorded in additional paid-in capital when realized. Realization of the net deferred tax asset is dependent upon future taxable income, if any, the amount and timing of which are uncertain. Accordingly, the net deferred tax asset has been offset by a full valuation allowance. The valuation allowance decreased by $(1,661) as of December 31, 2015. As of December 31, 2015, the Company had federal and state net operating loss carryforwards of approximately $99,453 and $26,285, respectively. As of December 31, 2015, the Company also had a federal and state research and development tax credit carryforwards of approximately $2,790 and $0, respectively. These net operating loss carryforwards and credits expire at various times through 2035. Section 382 of the Internal Revenue Code generally requires a corporation to limit the amount of its income in future years that can be offset by historic losses, i.e. net operating loss (NOL) carryforwards and certain built-in losses, after a corporation has undergone an ownership change. The Company has not been subject to a Section 382 limitation. In July 2006, the Financial Accounting Standards Board (“FASB”) issued ASC 740-10, Uncertainty in Income Taxes, which defines the threshold for recognizing the benefits of tax-return positions in the financial statements as “more-likely-than-not” to be sustained by the taxing authorities. This statement also requires explicit disclosure requirements about a Company’s uncertainties related to their income tax position, including a detailed roll-forward of tax benefits taken that do not qualify for financial statement recognition. The Company files income tax returns in the U.S. federal jurisdiction and several states. Given that the company has incurred tax losses since its inception, all of the Company’s tax years are effectively open to examination. The Company has no amount recorded for any unrecognized tax benefits as of December 31, 2015 nor did the Company record any amount for the implementation of ASC 740-10-25. The Company regularly evaluates its tax positions for additional unrecognized tax benefits and associated interest and penalties, if applicable. The Company believes that its accrual for tax liabilities is adequate for all open years. There are many factors that are considered when evaluating these tax positions including: interpretation of tax laws, recent tax litigation on a position, past audit or examination history, and subjective estimates and assumptions. In making these estimates and assumptions, the Company relies on advice from industry and subject matter experts, analyzes actions taken by taxing authorities, as well as the Company’s industry and audit experience. These evaluations are based on estimates and assumptions that have been deemed reasonable by management. However, if management’s estimates are not representative of actual outcomes, the Company’s results could be materially impacted. The Company received approval to sell a portion of the Company's New Jersey net operating losses and tax credits as part of the Technology Business Tax Certificate Program sponsored by The New Jersey Economic Development Authority. Under the program, emerging biotechnology firms with unused net operating loss carryovers and unused research and development credits are allowed to sell these benefits to other firms. The Company has participated in the Technology Business Tax Certificate Program since 2009. The most recent sales are detailed below: There were no New Jersey state net operating carryforwards sold during 2015. During the three months ended December 31, 2014 the Company sold New Jersey state net operating loss (NJ NOL) carry forwards and tax credits totaling $12,588 and $15, respectively for net proceeds of $1,059 which is reflected as a tax benefit in the transition period. During the year ended September 30, 2014, the Company sold New Jersey state net operating loss (NJ NOL) carry forwards and tax credits totaling $25,389 and $177, respectively for net proceeds of $1,295 which is reflected as a tax benefit in fiscal year 2014. In fiscal year ended September 30, 2013, the Company sold net operating losses and tax credits totaling $11,029 and $95, respectively for net proceeds of $899 which is reflected as a tax benefit in fiscal year 2013. |