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Income Taxes
9 Months Ended
Sep. 30, 2011
Income Taxes [Abstract] 
Income Taxes
13. Income Taxes
The Company’s effective tax rate was 52% and (81)% for the nine months ended September 30, 2011 and 2010, respectively. The provision for income taxes for the nine months ended September 30, 2011 includes a discrete tax expense of $65 related to a state tax assessment for a prior period. The effective tax rate excluding the discrete tax expense was 51% for the nine months ended September 30, 2011. The change in the effective tax rate excluding the discrete tax expense was as a result of applying the provision of ASC 740, Income Taxes, as it relates to interim periods. For the nine months ended September 30, 2011, the Company calculated the provision for income taxes using a forecasted tax rate for the year ended December 31, 2011. For the nine months ended September 30, 2010, due to net operating losses, the Company calculated the provision for income taxes using a period-to-date approach. The Company recognized interest and penalties totaling $21 in income tax expense in the nine months ended September 30, 2011.
For the year ended December 31, 2010, the Company had recorded a tax reserve of approximately $400 for the potential state income tax liability arising from the difference between the income tax rates applicable for security corporations and business corporations in Massachusetts, relating to the matter described in Note 9. In connection with such matter, on July 21, 2011, the Company received a Notice of Assessment from MA DOR for 2006 and 2007 in the amount of approximately $345 (which amount included all interest and penalties to date) with respect to additional income taxes related to TechTarget, Inc. The Company increased the reserve assessment to reflect additional interest accrued through the third quarter of 2011. The balance of the reserve assessment as of September 30, 2011 was $426. On August 17, 2011, the Company filed Applications for Abatement with the MA DOR and intends to continue to dispute the assessment and believes it has meritorious defenses which it intends to vigorously assert.
Tax years 2007 through 2010 are subject to examination by the federal and state taxing authorities. There are no income tax examinations currently in process with the exception of the TSC matter noted above related to the MA DOR.