Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Income Tax Disclosure [Abstract]

Income Tax Provision

For the years ended December 31, 2017, 2016 and 2015, the income tax provision was comprised of the following:

	Year Ended December 31,
	2017			2016		2015
	(in thousands)
Current:
Federal	$	16,852		$	24,509	$	20,947
State		4,721			8,132		6,260
Foreign		271			338		480
Total current		21,844			32,979		27,687
Deferred:
Federal		(30,794	)		800		(1,534	)
State		(385	)		516		(2,301	)
Total deferred		(31,179	)		1,316		(3,835	)
Total income tax (benefit) expense	$	(9,335	)	$	34,295	$	23,852

Income Before Provision for Income Taxes

Income before provision for income taxes for the years ended December 31, 2017, 2016 and 2015, was as follows:

	Year Ended December 31,
	2017		2016		2015
	(in thousands)
Domestic source	$	88,357	$	82,033	$	59,705
Foreign source		1,291		1,819		2,224
Income before provision for income taxes	$	89,648	$	83,852	$	61,929

Reconciliation of Income Taxes Computed at U.S. Federal Statutory Rate to Income Taxes

The following is a reconciliation of income taxes computed at the U.S. federal statutory rate to the income taxes reported in the consolidated statements of operations for the years ended December 31, 2017, 2016 and 2015:

	Year Ended December 31,
	2017			2016			2015
	(in thousands)
Income tax expense at statutory rate	$	31,377		$	29,348		$	21,675
State income taxes		5,011			5,621			2,577
Effect of rate change		(36,768	)		—			—
Stock-based compensation		(7,072	)		—			—
Research and development tax credit		(800	)		(638	)		(345	)
Foreign rate differential		(203	)		(273	)		(328	)
Unremitted earnings tax		363			—			—
Uncertain tax position		(55	)		—			—
Deferred tax true-up		—			—			69
All other		(1,188	)		237			204
Total income tax (benefit) expense	$	(9,335	)	$	34,295		$	23,852

Deferred Income Tax Assets and Liabilities

The tax effects of temporary differences giving rise to deferred income tax assets and liabilities as of December 31, 2017 and 2016 were as follows:

	As of December 31,
	2017			2016
	(in thousands)
Deferred tax assets:
Loss and credit carryforwards	$	11,184		$	6,714
Accrued expenses		2,089			2,096
Stock-based compensation		9,914			9,823
Total deferred tax assets		23,187			18,633
Valuation allowance		(4,803	)		(1,610	)
Net deferred tax assets		18,384			17,023
Deferred tax liabilities:
Fixed assets		(5,909	)		(5,738	)
Intangible assets		(86,462	)		(117,172	)
Prepaid expenses		(305	)		(2,135	)
Total deferred tax liabilities		(92,676	)		(125,045	)
Net deferred tax liability	$	(74,292	)	$	(108,022	)

Credit Carryforwards

The Company had the following tax loss and credit carryforwards as of December 31, 2017 and 2016:

	2017		2016		Beginning Year of Expiration
	(in thousands)
U.S. federal loss carryforwards	$	595	$	483	2027
U.S. state and local loss carryforwards		4,362		5,265	2027
Illinois Edge Credits(a)		8,422		5,045	2018

(a) Amounts are before the federal benefit of state tax

Unrecognized Tax Benefit Activity Excluding Related Accrual for Interest

The following table summarizes the Company’s unrecognized tax benefit activity during the years ended December 31, 2017 and 2016, excluding the related accrual for interest:

	As of December 31,
	2017			2016
	(in thousands)
Balance at beginning of period	$	3,345		$	2,932
Reductions for tax positions taken in prior years		(937	)		—
Additions for tax positions taken in prior years		—			413
Additions for tax positions taken in the current year		456			—
Balance at end of period	$	2,864		$	3,345