Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Income (Loss) before Income Taxes, Related to Jurisdictions

Income (loss) before income taxes relate to the following jurisdictions (in thousands):



	Years Ended December 31,
	2014			2013			2012
United States	$	(8,196	)	$	(5,457	)	$	3,158
Foreign	3,911			8,026			3,531
	$	(4,285	)	$	2,569		$	6,689

Provision for Income Taxes

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



	Years Ended December 31,
	2014			2013			2012
Current:
Federal	$	—		$	—		$	78
State	(11		)	(452		)	(30		)
Foreign	1,686			3,230			2,048
	1,675			2,778			2,096
Deferred:
Federal	—			—			—
State	—			—			—
Foreign	1,566			(23		)	(799		)
	1,566			(23		)	(799		)
Total	$	3,241		$	2,755		$	1,297

Significant Differences Between the U.S. Federal Statutory Tax Rate and Company's Effective Income Tax Expense for Earnings

The significant differences between the U.S. federal statutory tax rate of 34% and the Company’s effective income tax expense for earnings (in thousands) are as follows:



	Years Ended December 31,
	2014			2013			2012
Statutory federal income tax rate	$	(1,457	)	$	873		$	2,274
State income taxes, net of federal effect	(189		)	(657		)	24
Change in deferred tax asset valuation allowance	3,735			(142		)	(1,883		)
Foreign taxes in excess of U.S. statutory rate	714			1,784			486
Compensation deduction limitation	381			820			265
Other, net	57			77			131
Total	$	3,241		$	2,755		$	1,297

Tax Effects of Temporary Differences and Carry-Forwards that Give Rise to Deferred Tax Assets and Liabilities

The tax effects of temporary differences and carry-forwards that give rise to deferred tax assets and liabilities consist of the following (in thousands):



	Years Ended December 31,
	2014		2013
Deferred income tax assets:
Accounts payable and accrued expenses	$	1,712	$	1,864
Accrued payroll and related expenses	2,530		1,933
Stock-based compensation expense	10,226		9,811
Depreciation of property and equipment	5,480		5,836
Non-compete agreements	1		8
Unbilled receivables and refund liabilities	904		—
Operating loss carry-forwards of foreign subsidiary	1,920		1,690
Federal operating loss carry-forwards	30,669		31,003
Intangible assets	—		865
State operating loss carry-forwards	2,671		2,925
Other	1,930		2,165
Gross deferred tax assets	58,043		58,100
Less valuation allowance	52,002		48,453
Gross deferred tax assets net of valuation allowance	6,041		9,647
Deferred income tax liabilities:
Intangible assets	3,049		3,970
Unbilled receivables and refund liabilities	—		1,765
Capitalized software	1,834		984
Other	1,117		1,220
Gross deferred tax liabilities	6,000		7,939
Net deferred tax assets	$	41	$	1,708

Schedule of Unrecognized Tax Benefits

A reconciliation of our beginning and ending amount of unrecognized tax benefits and related accrued interest thereon is as follows:



	Unrecognized Tax Benefits			Accrued Interest and Penalties
Balance at January 1, 2012	$	2,649		$	2,218
Additions based on tax positions related to the current year	—			—
Additions based on tax positions related to the prior years	333			456
Decreases based on tax positions related to the prior years	$	(785	)	$	(1,214	)
Balance at December 31, 2013	$	2,197		$	1,460
Additions based on tax positions related to the current year	—			—
Additions based on tax positions related to the prior years	—			119
Decreases based on payments made during the year	(932		)	(385		)
Decreases based on tax positions related to the prior years	(541		)	(934		)
Balance at December 31, 2014	$	724		$	260
Additions based on tax positions related to the current year	—			—
Additions based on tax positions related to the prior years	—			33
Decreases based on payments made during the year	—			—
Decreases based on tax positions related to the prior years	(47		)	(73		)
Balance at December 31, 2014	$	677		$	220