Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

The components of income before income taxes and income tax expense for the years ended December 31, 2020, 2019 and 2018 are as follows (in thousands):


	Years ended December 31,
	2020		2019		2018
Income before income tax expense:
Domestic	$	427	$	12,814	$	5,577
Foreign	8,183		9,555		9,186
Total income before income tax expense	$	8,610	$	22,369	$	14,763

Income tax expense:
Current:
Federal	$	492	$	2,634	$	388
State and local	333		586		378
Foreign	2,868		5,046		3,285
Total current	3,693		8,266		4,051
Deferred:
Federal	(1,500)		(338)		813
State and local	(353)		(99)		258
Foreign	(298)		(649)		(195)
Total deferred	(2,151)		(1,086)		876
Total income tax expense	$	1,542	$	7,180	$	4,927

Schedule of effective income tax rate reconciliation

The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before income taxes. The sources and tax effects of the differences are as follows:


	December 31,
	2020		2019		2018
Federal income tax rate	21.0	%	21.0	%	21.0	%
State and local taxes net of federal benefit	(4.4)		3.0		1.9
Sale of subsidiary	(23.0)		—		—
Valuation allowance	20.0		6.3		0.4
Foreign tax credits	(10.0)		(5.0)		—
Foreign tax rate differential	5.0		4.1		1.8
Permanent differences	4.9		3.5		2.7
Other	3.7		(1.0)		2.2
Global Intangible Low-taxed Income	0.7		0.2		1.5
Tax Cuts and Jobs Act of 2017	—		—		1.9
Effective tax rate	17.9	%	32.1	%	33.4	%

Schedule of deferred tax assets and liabilities

Significant components of our deferred tax assets and liabilities are as follows (in thousands):


	December 31,
	2020		2019
Deferred tax assets:
Allowance for credit losses	$	1,201	$	291
Accrued liabilities and other	2,860		2,066
Stock-based compensation expense	807		297
Net federal, state and foreign operating loss carryforwards	3,147		2,825
Other	305		—
Foreign tax credit carryforwards	1,295		1,379
Deferred tax assets	9,615		6,858
Valuation allowance on deferred tax assets	(5,081)		(4,025)
Deferred tax liabilities:
Other	—		182
Intangible assets, property and equipment, principally due to difference in depreciation and amortization	7,137		8,969
Net deferred tax liabilities	$	(2,603)	$	(6,318)