INCOME TAXES FROM CONTINUING OPERATIONS

9 Months Ended

Sep. 30, 2015

INCOME TAXES FROM CONTINUING OPERATIONS

INCOME TAXES FROM CONTINUING OPERATIONS

NOTE 14—INCOME TAXES FROM CONTINUING OPERATIONS

There is no provision or benefit for federal, foreign or state income taxes for the three and nine months ended September 30, 2015 other than income tax benefit resulting from reversal of uncertain tax positions due to statute expirations of $(422) and $(316), respectively.

The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets. Based on the Company’s history of operating losses, the Company has concluded that it is more likely than not that the benefit of its deferred tax assets will not be realized. Accordingly, the Company has provided a full valuation allowance for deferred tax assets as of September 30, 2015 and December 31, 2014.

During the three and nine months ended September 30, 2014, the Company recorded an income tax (benefit) expense of $(559) and $176, respectively, resulting in an effective tax rate of (14.8)% and 1.9%, respectively. The projected annual effective tax rate, excluding discrete items primarily related to disallowed foreign losses and stock option cancellations, was a benefit of 34.8% as compared to the U.S. federal statutory rate of 35.0%. During the three months ended September 30, 2014, the Company recorded a $284 expense for non-cash deferred tax asset write-off associated with stock option cancellations and had $684 of disallowed foreign losses. The nine months ended September 30, 2014 was also negatively impacted from an additional $1,053 non-cash deferred tax asset write-off associated with stock option cancellations and an additional $1,168 of disallowed foreign losses.

The Company is currently under routine examination in the United States by the Internal Revenue Service for tax year 2014 in which the Company has claimed a $8,252 income tax refund.