Income Taxes

6 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Note 8. Income Taxes

The Company’s income tax expense and balance sheet accounts reflect the results of the Company and its subsidiaries.

For the three and six months ended June 30, 2022, the Company estimated the annual effective tax rate based on projected income for the full year and recorded a quarterly tax provision in accordance with the annual effective tax rate and adjusted for discrete tax items in the period.

The effective income tax rate for the three and six months ended June 30, 2022 was 27.6%. The Company’s effective income tax rate for the three and six months ended June 30, 2022 was higher than the U.S. federal statutory rate of 21% primarily due to Global Intangible Low-Taxed Income (“GILTI”) inclusion, nondeductible share-based compensation, and U.S. state income taxes.

The Company’s effective income tax rate for the three and six months ended June 30, 2021 was 44.8% and 8.1%, respectively. The Company’s effective income tax rate for the three months ended June 30, 2021 was higher than the U.S. federal statutory rate of 21% primarily due to the increase of the deferred income tax liability on intangibles as a result of the UK corporate income tax rate increase and U.S. state income taxes. The Company’s effective income tax rate for the six months ended June 30, 2021 was lower than the U.S. federal statutory rate of 21% primarily due to the increase of the deferred income tax liability on intangibles as a result of the UK corporate income tax rate increase, foreign withholding tax and U.S. state income tax expenses on losses before provision for income taxes for the six months ended June 30, 2021.