13. Income tax expense

Loss before income taxes attributable to domestic and international operations, consists of the following:


	Year ended December 31
(in thousands)	2017		2018		2019
Domestic	$	(66,109)	$	(113,699)	$	(78,761)
Foreign		(6,892)		(1,032)		(3,902)
Loss before income taxes	$	(73,001)	$	(114,731)	$	(82,663)

Income tax expense consists of the following:


	Year ended December 31
(in thousands)	2017		2018		2019
Current tax
Domestic	$	—	$	—	$	—
Foreign		55		(49)		(101)
Deferred tax
Domestic		—		—		—
Foreign		(1,410)		—		—
Total income tax expense	$	(1,355)	$	(49)	$	(101)

The reconciliation to our effective tax rate from the Irish statutory income tax rate of 12.5% for the years ended December 31, 2017, 2018 and 2019 is as follows:


	Year ended December 31
(% of pre-tax income)	2017		2018		2019
Statutory income tax rate	12.5	%	12.5	%	12.5	%
Non-deductible expenses	(0.8)		(0.1)		(0.1)
Income not subject to tax	0.9		0.3		0.3
Impairment	1.4		—		—
Tax credits	0.2		0.1		0.4
Foreign rate differential	21.0		(3.1)		0.6
In-process research and development	—		(3.5)		0.0
Tax audit assessments	—		—		(11.8)
Other	(1.4)		0.2		0.8
Valuation allowance	(35.6)		(6.5)		(2.8)
Effective income tax rate	(1.8)	%	(0.1)	%	(0.1)	%

The following table summarizes the components of deferred income tax balances:


	As of December 31,
(in thousands)	2018		2019
Deferred tax assets:
Net operating loss carryforwards	$	91,995	$	94,014
Tax loss on liquidation of subsidiary		6,245		5,024
Equity compensation		2,473		4,182
Non-deductible reserves		203		395
Total deferred tax assets		100,916		103,615
Valuation allowance		(100,832)		(103,185)
Net deferred tax assets		84		430
Deferred tax liabilities:
Financial liabilities		55		48
Property, plant and equipment		29		382
Total deferred tax liability		84		430
Deferred tax, net	$	—	$	—

The table below summarizes changes in the deferred tax valuation allowance:


	Year ended December 31,
(in thousands)	2017		2018		2019
Balance at beginning of year	$	(54,114)	$	(80,087)	$	(100,832)
Tax benefit		(25,973)		(7,301)		(2,353)
Acquired tax attributes		—		(13,444)		—
Balance at end of year	$	(80,087)	$	(100,832)	$	(103,185)

The following table summarizes carryforwards of net operating losses as of December 31, 2019.


(in thousands)	Amount		Expiration
Ireland	$	187,631	Indefinite
Austria	$	223,827	Indefinite
United States	$	10,403	Indefinite
United States	$	35,680	2033

Due to uncertainty regarding the ability to realize the benefit of deferred tax assets primarily relating to net operating loss carryforwards and the fact that the Company is in a three year pretax cumulative loss position, a full valuation allowance has been established.

On the basis of this evaluation, as of December 31, 2017, 2018 and 2019, the Company has recorded a valuation allowance of $80.1 million, $100.8 million and $103.2 million, respectively, to recognize only the portion of the deferred tax asset that is more likely than not to be realized. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as our projections for growth.

The Tax Cuts and Jobs Act (the “TCJA”) was enacted on December 22, 2017 and became effective January 1, 2018. The Tax Act had significant changes to U.S. tax law, lowering U.S. corporate income tax rates, implementing a territorial tax system, and modified the taxation of other income and expense items.

The TCJA reduces the U.S. corporate income tax rate from 35% to 21%, effective January 1, 2018. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. As a result of the reduction in the U.S. corporate income tax rate from 35% to 21% under the TCJA, the Company revalued the ending net deferred tax assets and liabilities of its U.S. subsidiary as of December 31, 2017. The tax impact of the revaluation of these deferred tax assets, net was $0.8 million, which was wholly offset by a corresponding reduction in the valuation allowance for these net deferred tax assets resulting in no impact to income tax expense.

At December 31, 2018, the Company had no uncertain tax positions and did not expect any material increase or decrease in income tax expense related to examinations or changes in uncertain tax positions. At December 31, 2019, the Company received a tax assessment from the government in Austria resulting in a change of deferred tax assets. The assessment does not result in a cash settlement.

The Company files income tax returns in Ireland. In addition, the Company’s foreign subsidiaries file separate income tax returns in Austria and the United States and state jurisdictions in which they are located. Tax years 2017 and forward remain open for examination for Ireland tax purposes and 2015 and forward remain open for examination for Austrian tax purposes and years 2016 and forward remain open for examination for United States tax purposes.

The Company’s policy is to record interest and penalties related to tax matters in income tax expense.