NOTE 12 - INCOME TAXES

A reconciliation between the income tax provision at the US statutory tax rate and the Company’s income tax provision on the condensed consolidated statements of operations and comprehensive income (loss) is below (in thousands, except for tax rates):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018

Income (loss) before income taxes	$	6,291		$	(5,844	)	$	20,204		$	(3,923	)
US statutory tax rate		21	%		21	%		21	%		21	%
Income tax expense (benefit) at statutory rate		1,321			(1,227	)		4,243			(824	)

State tax expense, net of federal		345			1,355			1,140			1,471
Foreign tax rates different from U.S. statutory rate		26			114			41			147
Non-deductible expenses		218			7,411			246			7,484
Credits		8			(86	)		(1	)		(95	)
Other		335			2			267			3
Total tax provision	$	2,253		$	7,569		$	5,936		$	8,186

Effective income tax rates for interim periods are based upon our current estimated annual rate. The Company’s effective income tax rate varies based upon an estimate of taxable earnings as well as on the mix of taxable earnings in the various states and countries in which we operate. Changes in the annual allocation and apportionment of the Company’s activity among these jurisdictions results in changes to the effective rate utilized to measure the Company’s deferred tax assets and liabilities.

As presented in the income tax reconciliation above, the tax provision recognized on the condensed consolidated statements of operations and comprehensive income (loss) was impacted by state taxes, non-deductible expenses such as share-based compensation expense, transaction costs and foreign tax rates applicable to the Company’s foreign subsidiaries that are higher or lower than the U.S. statutory rate.

On December 22, 2017, the U.S. enacted tax reform legislation known as H.R. 1, commonly referred to as the “Tax Cuts and Jobs Act” (the “Act”), resulting in significant modifications to existing law. All changes to the tax code that were effective as of January 1, 2018 have been applied by the Company in computing its income tax expense for the three and nine months ended September 30, 2019 and 2018. Additional guidance issued by the U.S. Treasury Department, the IRS and other standard-setting bodies may materially impact the provision for income taxes and effective tax rate in the period in which the guidance is issued.

In 2018, FinTech Acquisition Corp II was notified by the IRS that its 2017 federal income tax return was selected for examination. The Company has complied with all information requests to date. As of September 30, 2019, no amounts for tax, interest, or penalties have been paid or accrued as a result of this examination or any other uncertain tax positions.