TAXES

9 Months Ended

Sep. 30, 2021

Income Tax Disclosure [Abstract]

TAXES

TAXES

Our tax provision or benefit from income taxes for interim periods is determined using an estimate of our global annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment.

Our quarterly tax provision, and our quarterly estimate of our annual effective tax rate, is subject to change resulting from several factors, including variability in forecasting our pre-tax and taxable income and loss due to external changes in market conditions, changes in statutes, regulations and administrative practices, principles, and interpretations related to tax. Our

effective tax rate can be more or less volatile based on the amount of pre-tax income or loss. For example, the impact of discrete items and non-deductible expenses on our effective tax rate is greater when our pre-tax income is lower. As a result of circumstances surrounding our forecasted pre-tax loss, in accordance with ASC 740 principles, our interim year to date tax benefit is based on actual results through September 30, 2021. We believe this approach is the most fair representation of our income tax benefit as of September 30, 2021.Our income tax (expense) benefit for the three months ended September 30, 2021, and 2020, was $(1.1) million and $0.5 million, respectively. Our income tax benefit for the nine months ended September 30, 2021, and 2020, was $5.0 million and $3.3 million, respectively. For the nine months ended September 30, 2021, our effective tax rate of 26.0% was above the U.S. statutory rate of 21% primarily due to state taxes and tax credits. These items were primarily offset by certain other non-deductible items. For the nine months ended September 30, 2020, our effective tax rate of 15.0% was below the U.S. statutory rate of 21.0% primarily due to state taxes, foreign taxes, tax on Global Intangible Low-Taxed Income, and disallowed wage expense and fringe benefits. These items were primarily offset by tax credits. For the three and nine months ended September 30, 2021, we did not have any unrecognized tax benefits as a result of tax positions taken during a prior period or during the current period. No interest or penalties were recorded as a result of tax uncertainties.