Note 15 – Income Taxes

The Company’s loss from operations before income tax expense by jurisdiction for the years ended December 31 are as follows (in thousands):


	2019		2018		2017
Domestic	$	(124,189)	$	(176,290)	$	(173,749)
Foreign		(8,505)		(8,458)		(10,020)
Total net loss	$	(132,694)	$	(184,748)	$	(183,769)

As a result of current and historical losses, there is no income tax provision for the years ended December 31, 2019, 2018 and 2017.

Deferred tax assets (liabilities) consist of the following at December 31 (in thousands):


	2019		2018
Deferred tax assets:
Federal and State net operating loss carryforward	$	293,736	$	270,177
Foreign net operating loss carryforward		13,520		12,321
Research tax credits		37,066		33,633
Non-cash stock-based compensation		13,679		10,888
Original discount interest		4,326		5,687
Other		5,957		7,987
Total deferred tax assets		368,284		340,693
Valuation allowance		(365,772)		(337,515)
Net deferred tax assets	$	2,512	$	3,178

Deferred tax liabilities:
Intangibles		(1,279)		(1,492)
Other		(1,233)		(1,686)
Total deferred tax liabilities		(2,512)		(3,178)
Net deferred tax assets	$	—	$	—

The valuation allowance increased by $28.3 million and $37.7 million for the years ended December 31, 2019 and 2018, respectively, due to increases in deferred tax assets. Realization of net deferred tax assets is dependent on the Company’s ability to generate future taxable income, which is uncertain. Accordingly, a full valuation allowance was recorded against these assets as of December 31, 2019 and 2018 as management believes it is more likely than not that the assets will not be realizable.

The differences between the U.S. federal statutory tax rate and the Company's effective tax rate are as follows:


	2019		2018		2017
Statutory federal tax rate	(21)	%	(21)	%	(34)	%
State income taxes, net of federal benefit	(2)	%	(3)	%	(3)	%
Research and development and other tax credits	(3)	%	(3)	%	(2)	%
Other	1	%	1	%	(1)	%
Change in tax rate	3	%	5	%	70	%
Change in valuation allowance	22	%	21	%	(30)	%
Income tax provision	0	%	0	%	0	%

The change in the state tax rate from 2018 to 2019 is primarily related to changes in applicable state apportionment factors; whereas the change in the federal tax rate in 2017 resulted from the enactment of the Tax Cuts and Jobs Act of 2017.

As of December 31, 2019, the Company had net operating losses and research tax credits available as follows (in thousands):


	Amount
Federal and State net operating losses expiring through the year 2037	$	965,284
Federal and State net operating losses (no expiration)		284,084
Foreign net operating losses (no expiration)		36,972
Research tax credits expiring through the year 2039		61,455

Utilization of the net operating loss carryforwards and credits may be subject to an annual limitation due to ownership change of the Company. The Company does not expect such limitation, if any, to impact the use of the net operating losses and business tax credits.

At December 31, 2019 and 2018, the Company did not have any unrecognized tax benefits. To the extent unrecognized tax benefits are ultimately recognized, it would affect the annual effective income tax rate unless otherwise offset by a corresponding change in the valuation allowance. The Company does not expect that the amounts of unrecognized tax benefits will change significantly within the next twelve months.

The Company files income tax returns in the U.S. federal jurisdiction and in various states, as well as in Sweden. The Company had U.S. tax net operating losses and credit carryforwards that are subject to examination from 2000 through 2019. The tax returns of the Company may be subject to examination for a number of years beyond the year in which the losses were generated for tax purposes as a portion of these carryforwards may be utilized in the future. The returns in Sweden are subject to examination from 2014 through 2019.

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. As of December 31, 2019 and 2018, the Company had no accruals for interest or penalties related to income tax matters.