6. INCOME TAXES	3 Months Ended
Jun. 30, 2020
INCOME TAXES
NOTE 6 - INCOME TAXES	NOTE 6—INCOME TAXES The current portion of the Company’s unrecognized tax benefits was $0 at both June 30, 2020 and March 31, 2020. The long-term portion at June 30, 2020 and March 31, 2020 was $326,000 and $613,000, respectively, of which the timing of the resolution is uncertain. As of June 30, 2020, $2.8 million of unrecognized tax benefits had been recorded as a reduction to net deferred tax assets. As of June 30, 2020, the Company’s net deferred tax assets of $9.9 million were subject to a valuation allowance of $9.9 million. As of March 31, 2020, the Company’s net deferred tax assets of $9.4 million were subject to a valuation allowance of $9.4 million. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted. The CARES Act is an approximate $2 trillion emergency economic stimulus package passed in response to the COVID-19 global pandemic. The CARES Act contains numerous income tax provisions including changes to the net operating loss rules that the Company believes will not have a significant impact. Management believes that within the next twelve months the Company will not have a significant reduction in uncertain tax benefits, including interest and penalties, related to positions taken with respect to credits and loss carryforwards on previously filed tax returns. The Company’s policy is to include interest and penalties related to unrecognized tax benefits within the provision for income taxes in the Condensed Consolidated Statements of Operations. The Company is subject to taxation in the United States and various state and foreign jurisdictions. Fiscal years 2013 through 2020 remain open to examination by federal tax authorities, and fiscal years 2012 through 2020 remain open to examination by California tax authorities. During the quarter ended June 30, 2020, the Company settled an income tax audit in Israel for fiscal years 2016 through 2019 that resulted in a discrete tax provision of $479,000 and a tax liability of $713,000 that is included in accrued expenses and other liabilities on the condensed consolidated balance sheets as of June 30, 2020. The Company’s estimated annual effective income tax rate, including discrete items, was approximately (4.0%) and (8.7%) as of June 30, 2020 and 2019, respectively. The annual effective tax rates as of June 30, 2020 and 2019 vary from the United States statutory income tax rate primarily due to valuation allowances in the United States, whereby pre-tax losses do not result in the recognition of corresponding income tax benefits and expenses and the foreign tax differential.

NOTE 6—INCOME TAXES

The current portion of the Company’s unrecognized tax benefits was $0 at both June 30, 2020 and March 31, 2020. The long-term portion at June 30, 2020 and March 31, 2020 was $326,000 and $613,000, respectively, of which the timing of the resolution is uncertain. As of June 30, 2020, $2.8 million of unrecognized tax benefits had been recorded as a reduction to net deferred tax assets. As of June 30, 2020, the Company’s net deferred tax assets of $9.9 million were subject to a valuation allowance of $9.9 million. As of March 31, 2020, the Company’s net deferred tax assets of $9.4 million were subject to a valuation allowance of $9.4 million.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted. The CARES Act is an approximate $2 trillion emergency economic stimulus package passed in response to the COVID-19 global pandemic. The CARES Act contains numerous income tax provisions including changes to the net operating loss rules that the Company believes will not have a significant impact.

Management believes that within the next twelve months the Company will not have a significant reduction in uncertain tax benefits, including interest and penalties, related to positions taken with respect to credits and loss carryforwards on previously filed tax returns.

The Company’s policy is to include interest and penalties related to unrecognized tax benefits within the provision for income taxes in the Condensed Consolidated Statements of Operations.

The Company is subject to taxation in the United States and various state and foreign jurisdictions. Fiscal years 2013 through 2020 remain open to examination by federal tax authorities, and fiscal years 2012 through 2020 remain open to examination by California tax authorities. During the quarter ended June 30, 2020, the Company settled an income tax audit in Israel for fiscal years 2016 through 2019 that resulted in a discrete tax provision of $479,000 and a tax liability of $713,000 that is included in accrued expenses and other liabilities on the condensed consolidated balance sheets as of June 30, 2020.

The Company’s estimated annual effective income tax rate, including discrete items, was approximately (4.0%) and (8.7%) as of June 30, 2020 and 2019, respectively. The annual effective tax rates as of June 30, 2020 and 2019 vary from the United States statutory income tax rate primarily due to valuation allowances in the United States, whereby pre-tax losses do not result in the recognition of corresponding income tax benefits and expenses and the foreign tax differential.