A reconciliation between the U.S. federal statutory tax rate and the Company’s effective tax rate is summarized as follows:

	For the Years Ended December 31,
	2020			2019
Federal statutory rate		21.0	%		21.0	%
Tax credits		10.6	%		13.4	%
State taxes, net of federal tax benefit		8.0	%		6.1	%
Non-deductible expenses		(1.8	%)		(1.0	%)
Change in valuation allowance		(37.8	%)		(39.5	%)
Effective income tax rate		—	%		—	%

The principal components of the Company’s deferred tax assets and liabilities consist of the following:

	December 31,
	2020			2019
	(in thousands)
Deferred tax assets:
Net operating losses	$	72,838		$	41,589
R&D credits		39,888			25,328
Deferred revenue		8,251			8,456
Deferred rent		4,219			2,966
Capitalized R&D costs		1,039			1,207
Equity compensation		1,368			883
Accrued expense and other		1,914			108
Total deferred tax assets		129,517			80,537
Deferred tax liabilities:
Depreciation		(3,726	)		(2,744	)
Other		(757	)		—
Total deferred tax liabilities		(4,483	)		(2,744	)
Valuation allowance		(125,034	)		(77,793	)
Net deferred taxes	$	—		$	—

The Company has no income tax expense due to the operating loss incurred for the years ended December 31, 2020 and 2019. The Company has provided a valuation allowance for the full amount of the net deferred tax assets as the realization of the net deferred tax assets is not determined to be more likely than not.

At December 31, 2020, the Company had $265.1 million and $271.5 million of federal and state net operating loss carryforwards, respectively, that expire at various dates through 2040. Included in the federal net operating loss carryforwards of $265.1 million is $233.6 million that can be carried forward indefinitely. At December 31, 2020, the Company had $34.2 million and $7.2 million of federal and state research and development credit carryforwards, respectively, that expire at various dates through 2040. Included in the $34.2 million of federal research and development credit carryforwards is $29.0 million of orphan drug credit carryforwards. The valuation allowance increased in 2020 and 2019 by $47.2 million and $40.2 million, respectively, due to the increase in the deferred tax assets by the same amounts, primarily due to the net operating loss carryforwards and research and development tax credits not utilized.

For all years through December 31, 2020, the Company generated research credits but has not conducted a study to document the qualified activities. This study may result in an adjustment to the Company’s research and development credit carryforwards. Since a full valuation allowance has been provided against the Company’s research and development credits, any reduction in the gross deferred tax asset established for the research and development credit carryforwards would not result in any net impact to the Company’s consolidated financial statements.

Realization of the future tax benefits is dependent on many factors, including the Company’s ability to generate taxable income within the net operating loss carryforward period. Under the provisions of the Internal Revenue Code, certain substantial changes in the Company’s ownership, including a sale of the Company or significant changes in ownership due to sales of equity, may have limited, or may limit in the future, the amount of net operating loss carryforwards that could be used annually to offset future taxable income. The Company has not completed a study to assess whether a change of control has occurred or whether there have been multiple changes of control since the Company’s formation due to the significant complexity and cost associated with such study and because there could be additional changes in control in the future. As a result, the Company is not able to estimate the effect a change in control would have, if any, on the Company’s ability to utilize its net operating loss and research and development credit carryforwards in the future.

The Company files tax returns in the United States and Massachusetts. All tax years since inception remain open to examination by the major taxing jurisdictions to which the Company is subject, as carryforward attributes generated in years past may still be adjusted upon examination by the Internal Revenue Service (“IRS”) or other authorities if they have or will be used in a future period. The Company is not currently under examination by the IRS or any other jurisdictions for any tax years.

As of December 31, 2020, the Company had no uncertain tax positions. The Company has elected to recognize interest and penalties related to income tax matters as a component of income tax expense, of which no interest or penalties were recorded for the years ended December 31, 2020 and 2019.