Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Income Before Income Taxes

Income before income taxes consists of the following (in thousands):

	Years Ended December 31,
	2018		2017		2016
Domestic	$	17,718	$	20,061	$	22,303
Foreign		5,807		7,310		8,406
Total	$	23,525	$	27,371	$	30,709

Components of the Income Tax Provision

The components of the income tax provision are as follows (in thousands):

	Years Ended December 31,
	2018		2017		2016
Current:
Federal	$	2,278	$	2,587	$	6,094
State		1,173		1,060		2,330
Foreign		1,763		2,159		2,032
Total current		5,214		5,806		10,456
Deferred:
Federal		2,111		5,550		2,719
State		667		700		59
Foreign		153		175		(176	)
Total deferred		2,931		6,425		2,602
Income tax provision	$	8,145	$	12,231	$	13,058

Reconciliation of the Federal Statutory Rate

A reconciliation of the federal statutory rate to Forrester’s effective tax rate is as follows:

	Years Ended December 31,
	2018			2017			2016
Income tax provision at federal statutory rate		21.0	%		35.0	%		35.0	%
Increase (decrease) in tax resulting from:
State tax provision, net of federal benefit		6.2			4.0			5.0
Foreign tax rate differential		(0.2	)		(3.4	)		(4.4	)
Stock option compensation deduction		(1.1	)		0.1			0.6
Withholding taxes		2.1			1.7			0.5
Non-deductible expenses		5.3			1.8			1.5
Change in valuation allowance		—			3.9			3.2
Change in tax legislation		1.9			5.8			—
Audit settlements		—			(4.0	)		—
Other, net		(0.6	)		(0.2	)		1.1
Effective tax rate		34.6	%		44.7	%		42.5	%

Components of Deferred Income Taxes

The components of deferred income taxes are as follows (in thousands):

	As of December 31,
	2018			2017
Non-deductible reserves and accruals	$	3,835		$	4,936
Net operating loss and other carryforwards		7,954			8,528
Stock compensation		2,125			2,644
Depreciation and amortization		727			402
Other assets		—			46
Gross deferred tax asset		14,641			16,556
Less - valuation allowance		(2,574	)		(2,686	)
Sub-total		12,067			13,870
Other liabilities		(1,249	)		(911	)
Goodwill and intangible assets		(6,201	)		(5,677	)
Deferred commissions		(4,479	)		(3,873	)
Net deferred tax asset	$	138		$	3,409

Summary of Changes in Deferred Tax Valuation Allowance

The following table provides a summary of the changes in the deferred tax valuation allowance for the years ended December 31, 2018, 2017 and 2016 (in thousands):

	2018			2017			2016
Deferred tax valuation allowance at January 1	$	2,686		$	2,193		$	1,534
Additions		74			1,439			1,256
Deductions		(139	)		(70	)		(455	)
Change in tax legislation		—			(954	)		—
Translation adjustments		(47	)		78			(142	)
Deferred tax valuation allowance at December 31	$	2,574		$	2,686		$	2,193

Reconciliation of Unrecognized Tax Benefits

. A reconciliation of the beginning and ending amount of unrecognized tax benefits is summarized as follows for the years ended December 31, 2018, 2017 and 2016 (in thousands):

	2018			2017			2016
Unrecognized tax benefits at January 1	$	806		$	1,774		$	1,910
Reductions for tax positions of prior years		—			—			(31	)
Additions for tax positions of current year		—			—			75
Settlements		—			(986	)		(163	)
Translation adjustments		(7	)		18			(17	)
Unrecognized tax benefits at December 31	$	799		$	806		$	1,774