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Income Taxes
12 Months Ended
Dec. 31, 2014
Income Taxes  
Income Taxes

13. Income Taxes

        There was no provision for income taxes for the years ended December 31, 2014, 2013 and 2012 because the Company has incurred operating losses since inception. At December 31, 2014, the Company has concluded that it is not more likely than not that the Company will realize the benefit of its deferred tax assets due to its history of losses. Accordingly, the net deferred tax assets have been fully reserved.

        As of December 31, 2014, 2013 and 2012, the Company had deferred tax assets, before valuation allowance, of approximately $34.2 million, $22.8 million and $14.4 million, respectively. Realization of the deferred assets is dependent upon future taxable income, if any, the amount and timing of which are uncertain. Accordingly, the net deferred tax assets have been fully offset by a valuation allowance.

        As of December 31, 2014, 2013 and 2012, the Company had federal net operating loss carryforwards of approximately $95.1 million, $62.3 million and $40.5 million, respectively. The federal net operating loss will expire at various dates beginning in 2028, if not utilized. As of December 31, 2014, 2013 and 2012, the Company had state net operating loss carryforwards of approximately $16.6 million, $33.1 million and $11.3 million, respectively. The state net operating loss will expire at various dates beginning in 2022, if not utilized. The Company has $0.5 million of NOLs related to excess tax benefits generated upon the settlement of stock awards that increased a current year net operating loss. The Company cannot record the benefit of these losses in the financial statements until the losses are utilized to reduce its income taxes payable at which time it will recognize the tax benefit in equity.

        A reconciliation of the U.S. statutory income tax rate to the Company's effective tax rate is as follows:

                                                                                                                                                                                    

 

 

December 31,

 

 

 

2014

 

2013

 

2012

 

Federal income tax (benefit) at statutory rate

 

 

(34.0 

)%

 

(34.0 

)%

 

(34.0 

)%

Change in Tax Rate

 

 

2.1 

%

 

%

 

%

Permanent items

 

 

1.0 

%

 

4.9 

%

 

0.4 

%

Other

 

 

0.1 

%

 

%

 

(0.2 

)%

Change in valuation allowance

 

 

30.8 

%

 

29.1 

%

 

33.8 

%  

​  

​  

​  

​  

​  

​  

Effective income tax rate

 

 

0.0 

%

 

0.0 

%

 

0.0 

%  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

 

        If the Company experiences a greater than 50 percentage point aggregate change in ownership of certain significant stockholders over a three-year period, a Section 382 ownership change could be deemed to have occurred. If a section 382 change occurs, the Company's future utilization of the net operating loss carryforwards and credits as of the ownership change will be subject to an annual limitation under Section 382 of the Internal Revenue Code of 1986, as amended, and similar state provisions. Such an annual limitation may result in the expiration of net operating losses before utilization.

        The Company's reserves related to taxes are based on a determination of whether and how much of a tax benefit taken by the Company in its tax filings or positions is more likely than not to be realized following resolution of any potential contingencies present related to the tax benefit. The Company recognized no material adjustment for unrecognized income tax benefits. Through December 31, 2014, the Company had no unrecognized tax benefits or related interest and penalties accrued.

        Significant components of the Company's deferred tax assets are summarized in the table below:

      

 

 

December 31,

 

 

 

2014

 

2013

 

 

 

(in thousands)

 

Deferred tax assets:

 

 

 

 

 

 

 

Federal and state operating loss carryforwards

 

$

33,099

 

$

22,485

 

Equity Compensation

 

 

971

 

 

206

 

Temporary differences

 

 

138

 

 

113

 

​  

​  

​  

​  

Total deferred tax assets

 

 

34,208

 

 

22,804

 

Valuation allowance

 

 

(34,208

)

 

(22,804

)

​  

​  

​  

​  

Net deferred tax assets

 

$

 

$

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​