Income Taxes

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Income Taxes

12. Income Taxes

The components of the Company’s loss before provision for (benefit from) income taxes are as follows:

	Years Ended December 31,
	2022			2021
United States of America	$	(18,455	)	$	(16,192	)
International		533			3,114
Loss before provision for (benefit from) income taxes	$	(17,922	)	$	(13,078	)

The components of the provision for (benefit from) income taxes were as follows:

	Years Ended December 31,
	2022		2021
Current income tax provision:
State	$	25	$	39
Foreign		232		(179	)
Total current income tax provision		257		(140	)
Deferred income tax benefit:
Foreign		48		6
Total deferred income tax benefit		48		6
Provision for (benefit from) income taxes	$	305	$	(134	)

The differences in the total provision for (benefit from) income taxes that would result from applying the 21% federal statutory rate in 2022 and 2021 to the loss before provision for income taxes and the reported provision for income taxes were as follows:

	Years Ended December 31,
	2022			2021
Tax benefit at U.S. statutory rate	$	(3,763	)	$	(2,746	)
Change in valuation allowance		6,009			4,547
Stock-based compensation		(6	)		46
Uncertain tax positions		(32	)		(194	)
State income taxes, net of federal benefit		(1,288	)		(1,223	)
Foreign income and withholding taxes		8			(560	)
Other permanent differences		81			52
PPP loan forgiveness		(667	)		—
Provision to return adjustments		(37	)		(56	)
Provision for (benefit from) income taxes	$	305		$	(134	)

Major components of the Company’s deferred tax assets and liabilities as of December 31, 2022 and 2021 were as follows:

	December 31,
	2022			2021
Non-current deferred tax assets:
Net operating loss	$	37,783		$	32,403
Research and development credits		9,820			9,820
Other credits		4,165			4,164
Operating lease liabilities		1,037			566
Stock-based compensation		1,164			476
Property and equipment and intangible assets		—			653
Capitalized research and development		912			—
Accruals and reserves		133			387
Gross non-current deferred tax assets		55,014			48,469
Right-of-use assets, operating leases		(1,037	)		(471	)
Property and equipment and intangible assets		(23	)		—
Total non-current deferred tax liabilities		(1,060	)		(471	)
Total deferred tax assets		53,954			47,998
Valuation allowance		(53,924	)		(47,915	)
Net deferred tax assets (liabilities)	$	30		$	83

The Tax Reform Act of 1986, as amended, imposes restrictions on the utilization of net operating losses and tax credit carryforwards in certain situations where changes occur in the stock ownership of a corporation. Utilization of a domestic net operation loss or tax credit carryforward may be subject to a substantial limitation due to ownership changes that may have occurred or that could occur in the future, as required by Internal Revenue Code Section 382 ("IRC Section 382"), as well as similar state provisions. Accordingly, a company’s ability to use net operating losses may be limited as prescribed under IRC Section 382. Events which may cause limitations in the amount of the net operating losses that the Company may use in any one year include, but are not limited to, a cumulative ownership change of more than 50% over a three-year period. The Company last assessed the application of IRC Section 382 during the fourth quarter of 2017 and concluded that no such limitation currently applies. These conclusions are monitored in future periods as circumstances dictate, such as significant changes in the Company's stock ownership. In the event the Company experiences any subsequent changes in ownership, the amount of net operating losses and research and development credit carryovers available in any taxable year could be limited and may expire unutilized.

As of December 31, 2022, the Company had federal and state net operating loss carryforwards of approximately $151,712 and $132,925, respectively. The federal net operating loss carryforward will begin expiring in 2027 and the state net operating loss carryforward began expiring in 2022. As of December 31, 2022, the Company had federal and state research and development credits of approximately $6,123 and $6,451, respectively. The federal research and development credits will begin expiring in 2026. The state research and development credits are not currently subject to expiration.
 

The Company has recorded a full valuation allowance against its otherwise recognizable deferred income tax assets as of December 31, 2022 and 2021 (except for the deferred income tax assets associated with certain of the Company’s foreign subsidiaries). The Company has determined, after evaluating all positive and negative historical and prospective evidence, that it is more likely than not that the deferred income tax assets will not be realized (except for those associated with certain of the Company's foreign subsidiaries). The valuation allowance increased by $6,009 and $4,547 for the years ended December 31, 2022, and December 31, 2021, respectively.

The Company files federal, state and foreign income tax returns in jurisdictions with varying statutes of limitations. In the normal course of business, the Company is subject to examination by taxing authorities throughout the world. These audits include questioning the timing and amount of deduction, the nexus of income among various tax jurisdictions and compliance with state, local and foreign tax laws. The Company is not currently under any examination by any federal, state or foreign tax authorities. Because of net operating loss and credit carryforwards, all of the Company’s tax years dating to inception in 2006 remain open to examination.

Uncertain Tax Positions

As of December 31, 2022 and 2021, the Company had uncertain tax positions of $985 and $1,079, respectively, that if recognized would impact the annual effective tax rate. During 2022 and 2021, the Company did not have any material interest or penalties related to uncertain tax positions. The aggregate changes in the balance of gross uncertain tax positions were as follows:

Ending balance as of December 31, 2020	$	9,347
Decrease in balances related to lapses in statutes of limitations		(292	)
Ending balance as of December 31, 2021		9,055
Decrease in balances related to lapses in statutes of limitations		(94	)
Ending balance as of December 31, 2022	$	8,961

The Company does not anticipate that the amount of uncertain tax positions relating to tax positions existing at December 31, 2022 will materially increase or decrease within the next twelve months.