Income Taxes

3 Months Ended

Mar. 31, 2020

Income Tax Disclosure [Abstract]

Income Taxes

8. Income Taxes

For the three months ended March 31, 2020, we had an effective tax benefit rate of 7.1%, compared to an effective income tax rate of 56.0% for the three months ended March 31, 2019.  During the three months ended March 31, 2020, our effective tax benefit rate was lower than our statutory benefit rate primarily due to the nondeductible goodwill impairment loss of $119.5 million recorded during the quarter.  Our effective income tax rate for the three months ended March 31, 2019 was affected by two adjustments related to the acquisition of Nutrisystem in March 2019 that collectively increased our income tax expense for such period by approximately $2.7 million: (i) we evaluated the realizability of beginning-of-the-year deferred tax assets and increased the valuation allowance on deferred tax assets related to state net operating loss carryforwards by $1.8 million, and (ii) we recorded a $0.9 million reduction in deferred tax assets related to state income tax credits.

We file income tax returns in the U.S. Federal jurisdiction and in various state and foreign jurisdictions.  Tax years remaining subject to examination in the U.S. Federal jurisdiction include 2016 to present.