Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Components of Income Tax Expense (Benefit)

The income tax (benefit) provision consisted of the following (in thousands):



	Current			Deferred			Total
Year ended December 31, 2019
Federal	$	(61,951	)	$	195		$	(61,756	)
State	509			30			539
Foreign	—			209			209
	$	(61,442	)	$	434		$	(61,008	)
Year ended December 31, 2018
Federal	$	2,768		$	(40,345	)	$	(37,577	)
State	(1,677		)	(2,093		)	(3,770		)
Foreign	32			5,042			5,074
	$	1,123		$	(37,396	)	$	(36,273	)
Year ended December 31, 2017
Federal	$	78,806		$	(105,006	)	$	(26,200	)
State	1,706			(9,785		)	(8,079		)
Foreign	89			(458		)	(369		)
	$	80,601		$	(115,249	)	$	(34,648	)

Schedule of Effective Income Tax Rate Reconciliation

The income tax provision differs from the “expected” tax expense computed by applying the U.S. Federal corporate income tax rates of 21% to loss before income taxes, as follows (in thousands):



	Years Ended December 31,
	2019			2018			2017
Computed “expected” tax provision	$	(60,433	)	$	(92,018	)	$	(20,719	)
Change in income taxes resulting from:
State income taxes, net of Federal income tax	(7,402		)	(11,667		)	(537		)
Change in state income tax rate, net of Federal income tax	728			(16		)	(4,714		)
Foreign income tax (benefit) provision	(2,623		)	(1,658		)	2,206
Deduction for domestic production activities	—			—			(2,527		)
Stock compensation	4,565			2,480			(1,316		)
R&D tax credits	(1,428		)	(750		)	(1,200		)
Nondeductible acquisition fees	—			(1,165		)	1,974
Uncertain tax positions	(47,357		)	7,935			15,650
Federal rate change	—			(3,027		)	(26,902		)
Lapse of statute of limitations	(16,034		)	570			1,561
Taxes receivable true up	2,651			—			—
Deferred tax adjustment	17,578			—			—
162(m) Officers Compensation Limitation	340			1,483			—
Other expense, net	408			934			1,201
Valuation allowance change	47,999			60,626			675
Income tax (benefit)	$	(61,008	)	$	(36,273	)	$	(34,648	)

Schedule of Income before Income Tax, Domestic and Foreign

The geographic allocation of the Company’s income before income taxes between U.S. and foreign operations was as follows (in thousands):



	2019			2018			2017
Pre-tax (loss) from U.S. operations	$	(237,474	)	$	(428,299	)	$	(49,572	)
Pre-tax (loss) from foreign operations	(50,304		)	(9,883		)	(9,626		)
Total pre-tax (loss)	$	(287,778	)	$	(438,182	)	$	(59,198	)

Schedule of Deferred Tax Assets and Liabilities

Net deferred income taxes at December 31, 2019 and 2018 include (in thousands):



	December 31,
	2019			2018
Deferred tax assets:
Net operating loss carry-forward	$	51,125		$	48,766
Stock-based compensation	8,912			9,071
Chargeback reserves	3,336			14,173
Reserve for product returns	8,001			8,012
Inventory valuation reserve	8,423			9,688
Legal reserve	15,294			—
Long-term debt	56,117			16,156
Other	16,793			16,444
Total deferred tax assets	$	168,001		$	122,310
Valuation allowance	(119,156		)	(71,157		)
Net deferred tax assets	$	48,845		$	51,153
Deferred tax liabilities:
Prepaid expenses	$	(2,190	)	$	(2,137	)
Right of Use Asset	(5,311		)	—
Depreciation & amortization – tax over book	(41,534		)	(49,547		)
Other	$	(35	)	$	(35	)
Total deferred tax liabilities	$	(49,070	)	$	(51,719	)
Net deferred income tax (liability)	$	(225	)	$	(566	)

Schedule of Unrecognized Tax Benefits Roll Forward

Based on its review as of December 31, 2019, the Company determined that it would not recognize tax benefits as follows (in thousands):



Balance at December 31, 2016	$	1,301
Additions relating to 2017	416
Additions relating to prior years	$	24,297
Reductions of exposures relating to prior years	(619		)
Balance at December 31, 2017	$	25,395
Additions relating to 2018	269
Additions relating to prior years	4,425
Reductions of exposures relating to prior years	(702		)
Balance at December 31, 2018	$	29,387
Reductions of exposures relating to prior years	(26,992		)
Lapse of statute of limitations	$	(33	)
Balance at December 31, 2019	$	2,362