Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Schedule of Components of Income Tax Expense (Benefit)

The benefit for income taxes attributable to income from operations includes the following (in thousands):


	For the Years Ended December 31,
	2021		2020		2019
Current (benefit) provision
Federal	$	—	$	—	$	25
State	(98)		(77)		68
Total current	(98)		(77)		93

Deferred provision (benefit)
Federal	19		27		88
State	51		4		(285)
Total deferred	70		31		(197)
Total benefit	$	(28)	$	(46)	$	(104)

Schedule of Effective Income Tax Rate Reconciliation

The reconciliation of these differences is as follows:


	For the Years Ended December 31,
	2021		2020		2019
Computed expected income tax provision	21.0	%	21.0	%	21.0	%
State income taxes, net of federal income tax benefit	1.5		1.0		(0.7)
Change in valuation allowance for deferred tax assets	(7.9)		17.0		(24.7)
Cumulative deferred adjustments	—		0.7		(1.1)
Provision to return adjustments	(0.4)		0.5		1.3
Other permanent differences	(0.2)		1.0		(3.8)
Dividend and accretion on preferred stock	—		10.5		(35.8)
Gain on redemption of preferred stock	—		(43.3)		—
Section 162(m) limitation - covered employees	(16.0)		14.6		(6.9)
Capitalization of IPO transaction costs	—		4.4		—
FIN 48 liability	(0.6)		0.2		(3.7)
R&D credit	2.7		(12.4)		19.0
Non-controlling interest	—		(15.9)		40.0

	0.1	%	(0.7	%)	4.6	%

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities on December 31, 2021 and 2020 are as follows (in thousands):


	December 31,
	2021		2020
Deferred tax assets:
Accounts receivable, principally due to allowance for doubtful accounts	$	29	$	78
Allowance for inventory obsolescence and amortization	315		398
Accrued liabilities not currently deductible	1,713		2,204
Stock-based compensation	7,993		—
Accrued compensation	648		1,161
Deferred rent	3,813		4,387
Section 163(j) interest limitation	54		306
Goodwill	37,394		41,534
Net operating loss carryforwards - federal	5,681		3,814
Net operating loss carryforwards - state	1,014		1,002
R&D credit	2,645		1,986
Total gross deferred tax assets	61,299		56,870
Less valuation allowance	(55,588)		(52,198)
Total deferred tax assets, net of valuation allowance	5,711		4,672
Deferred tax liabilities:
Amortization and depreciation	(6,434)		(4,471)
Unbilled accounts receivable, deferred for tax purposes	—		(853)


Total deferred tax liabilities	(6,434)		(5,324)
Net deferred tax liabilities	$	(723)	$	(652)

Components of Valuation Allowance

The components of the valuation allowance are as follows (in thousands):


	Balance Beginning of Period		Additions		Recoveries		Balance End of Period

December 31, 2021	$	52,198	$	3,390	$	—	$	55,588
December 31, 2020	$	7,206	$	44,992	$	—	$	52,198
December 31, 2019	$	6,652	$	554	$	—	$	7,206

Schedule of Unrecognized Tax Benefits Roll Forward

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows (in thousands):


	2021		2020		2019
Unrecognized tax benefits, beginning of period	$	763	$	714	$	649
Increase (decrease) in prior year tax positions	90		(104)		1
Increase related to current year tax positions	273		213		101
Decrease related to lapse of statutes	(70)		(60)		(37)
Unrecognized tax benefits, end of period	$	1,056	$	763	$	714