Income Taxes (Tables)

12 Months Ended

Sep. 30, 2020

Income taxes in the accompanying consolidated statements of operations were as follows:

	Fiscal Year
(In thousands)	2020			2019			2018
Current (benefit) provision:
U.S. Federal	$	(1,570	)	$	1,355		$	(890	)
U.S. State		42			192			51
International		90			41			41
Total current (benefit) provision		(1,438	)		1,588			(798	)
Deferred (benefit) provision:
U.S. Federal		(1,336	)		(1,505	)		(2,006	)
U.S. State		197			(117	)		(271	)
International		—			—			—
Total deferred benefit (1)		(1,139	)		(1,622	)		(2,277	)
Total income tax benefit	$	(2,577	)	$	(34	)	$	(3,075	)

(1)

Both the current and deferred benefit include the impact of the adoption of ASC Topic 606 in fiscal 2019, which reduced deferred income taxes and income taxes receivable by $1.2 million and $0.4 million, respectively, as of adoption (Note 2).

Schedule of Reconciliation Difference of Income Taxes

The following is a reconciliation of the difference between amounts calculated at the statutory U.S. federal income tax rate of 21%, 21% and 24.5% for fiscal 2020, 2019 and 2018, respectively, and the Company’s effective tax rate:

	Fiscal Year
(In thousands)	2020			2019			2018
Amount at statutory U.S. federal income tax rate	$	(305	)	$	1,587		$	(1,845	)
Change because of the following items:
State income taxes, net of federal benefit		(551	)		(452	)		(724	)
U.S. Federal and foreign research and development credits		(1,571	)		(2,464	)		(1,710	)
Foreign and state rate differential		212			156			371
Valuation allowance change		825			671			960
Stock-based compensation (1)		(81	)		(163	)		(2,063	)
Contingent consideration (gain) expense and related foreign currency revaluation		—			(61	)		142
U.S. Federal and state rate change		17			44			1,582
Tax reserve change		609			770			158
Foreign-derived income deduction		(88	)		(150	)		—
Impact of CARES Act		(1,700	)		—			—
Other		56			28			54
Income tax benefit	$	(2,577	)	$	(34	)	$	(3,075	)

(1)

Includes non-deductible stock-based compensation.

Schedule of Deferred Income Taxes

The components of deferred income taxes consisted of the following and result from differences in the recognition of transactions for income tax and financial reporting purposes:

	September 30,
(In thousands)	2020			2019
Depreciable assets	$	(1,964	)	$	(905	)
Deferred revenue		2,029			1,554
Accruals and reserves		1,858			585
Stock-based compensation		2,232			2,213
Impaired strategic investments		1,767			1,666
NOL carryforwards		3,526			3,308
U.S. Federal and State R&D credits		3,216			2,394
Other		897			689
Valuation allowance		(6,246	)		(5,328	)
Total deferred tax assets	$	7,315		$	6,176

Summary of Reconciliation of Changes in Unrecognized Tax Benefits

Unrecognized tax benefits are the differences between a tax position taken, or expected to be taken in a tax return, and the benefit recognized for accounting purposes pursuant to accounting guidance. The following is a reconciliation of the changes in unrecognized tax benefits, excluding interest and penalties:

	Fiscal Year
(In thousands)	2020			2019			2018
Unrecognized tax benefits, beginning balance	$	2,323		$	1,559		$	1,481
Increases in tax positions for prior years		58			278			61
Decreases in tax positions for prior years		(1	)		(2	)		—
Increases in tax positions for current year		664			735			735
Settlements with taxing authorities		—			—			(613	)
Lapse of the statute of limitations		(173	)		(247	)		(105	)
Unrecognized tax benefits, ending balance	$	2,871		$	2,323		$	1,559