Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Components of Net Income from Continuing Operations Before Income Taxes

Income Tax Provision/(Benefit). The components of net income before income taxes are as follows (in thousands):

	2017			2016		2015
Domestic	$	89,095		$	98,966	$	93,390
Foreign		(1,385	)		1,033		2,951
Total	$	87,710		$	99,999	$	96,341

Schedule of Components of Income Tax Expense (Benefit)

The income tax provision consists of the following (in thousands):

	2017		2016			2015
Current:
Federal	$	13,422	$	31,409		$	41,002
State		1,909		3,819			5,227
Foreign		3,903		4,639			3,651
		19,234		39,867			49,880
Deferred:
Federal		5,582		(2,229	)		(14,611	)
State		937		276			(1,147	)
Foreign		593		(797	)		(348	)
		7,112		(2,750	)		(16,106	)
Total income tax provision	$	26,346	$	37,117		$	33,774

Schedule of Effective Income Tax Rate Reconciliation

The difference between our income tax provision computed at the statutory Federal income tax rate and our financial statement income tax is summarized as follows (in thousands):

	2017			2016			2015
Provision at Federal rate of 35%	$	30,699		$	35,000		$	33,719
State income taxes, net of Federal impact		1,850			2,662			2,652
Research and experimentation credits		(2,853	)		(71	)		(2,135	)
Stock award vesting		(7,882	)		—			—
Tax uncertainties		166			(1,597	)		(166	)
Section 199 manufacturing deduction		(962	)		(4,060	)		(2,884	)
Foreign rate differential		162			857			688
Valuation allowance for deferred tax assets		2,351			1,287			919
Other impact of foreign operations		3,933			2,157			283
Statutory rate change		(2,210	)		—			—
Other		1,092			882			698
Total income tax provision	$	26,346		$	37,117		$	33,774

Net Deferred Income Tax Assets

Deferred Income Taxes. Net deferred income tax assets as of December 31, 2017 and 2016 are as follows (in thousands):

	2017			2016
Deferred income tax assets	$	56,013		$	65,690
Deferred income tax liabilities		(25,184	)		(33,748	)
Valuation allowance		(21,356	)		(17,823	)
Net deferred income tax assets	$	9,473		$	14,119

The Components of Net Deferred Income Tax Assets (Liabilities)

The components of our net deferred income tax assets (liabilities) as of December 31, 2017 and 2016 are as follows (in thousands):

	2017			2016
Net deferred income tax assets:
Accrued expenses and reserves	$	10,745		$	13,252
Stock-based compensation		3,312			5,066
Software		(4,364	)		912
Client contracts and related intangibles		(5,932	)		(590	)
Goodwill		(5,828	)		(8,336	)
Net operating loss carryforwards		29,953			36,123
Property and equipment		1,381			(8,672	)
Convertible debt securities		(3,639	)		(16,094	)
Deferred revenue		2,225			3,556
Facility abandonments		344			2,273
Contingent payments		(1,860	)		848
Foreign exchange gain/loss		1,776			1,658
R&D credit		1,560			907
Other		1,156			1,039
Total deferred income tax assets		30,829			31,942
Less: valuation allowance		(21,356	)		(17,823	)
Net deferred income tax assets	$	9,473		$	14,119

Reconciliation of Beginning and Ending Balances of Liability for Unrecognized Tax Benefits

A reconciliation of the beginning and ending balances of our liability for unrecognized tax benefits is as follows (in thousands):

	2017			2016			2015
Balance, beginning of year	$	1,891		$	4,079		$	3,417
Additions based on tax positions related to current year		136			—			150
Audit settlements		(183	)		(1,893	)		—
Lapse of statute of limitations		(174	)		(122	)		—
Additions for tax positions of prior years		257			370			925
Reductions for tax positions of prior years		(12	)		(543	)		(413	)
Balance, end of year	$	1,915		$	1,891		$	4,079