Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Components of income before income taxes from continuing operations and the provision for income taxes

For the years ended December 31, 2014, 2013, and 2012, the following table summarizes the components of income before income taxes from continuing operations and the provision for income taxes:

	Year Ended December 31,
	2014			2013			2012
Income (loss) before income tax:
U.S.	$	(25,398	)	$	7,700		$	3,152
Israel		1,780			14,279			20,410
Other Foreign		(1,813	)		768			3,365
Income (loss) before income taxes	$	(25,431	)	$	22,747		$	26,927


Income tax expense (benefit):
United States - Federal tax:
Current	$	(1,030	)	$	(1,253	)	$	2,752
Deferred		34,117			1,795			(1,572	)

United States - State tax:
Current		195			180			315
Deferred:		245			850			(2,074	)

Israel:
Current		1,431			2,781			4,034
Deferred		(190	)		(237	)		(50	)

Other foreign:
Current		81			54			1371
Deferred:		1,463			200			(338	)

Income tax expense	$	36,312		$	4,370		$	4,438

Reconciliation of the federal statutory income tax rate to the effective income tax rate

For the years ended December 31, 2014, 2013 and 2012, the following table reconciles the federal statutory income tax rate to the effective income tax rate:

	Year Ended December 31,
	2014			2013			2012
Federal Tax rate		34	%		34	%		34	%


Federal tax expense (benefit) at 34%	$	(9,349	)	$	7,733		$	9,157
State and local income tax, net of Federal benefit		373			958			286
Foreign rate differential		(483	)		(2,404	)		(3,962	)
Increase in taxes from permanent differences in stock-based compensation		330			420			618
US taxation of foreign earnings – Subpart F		11,571			357			403
Increase (decrease) in uncertain tax positions		-			269			(2,325	)
Return to provision and other adjustments		301			(1,963	)		-
Impact of tax rate change on deferred taxes		724			(942	)		-
Foreign tax credits		(7,041	)		(341	)		-
Tax on foreign exchange		1,578			-			-
Tax on undistributed earnings		3,333			-			-
Change in valuation allowance		34,695			116			-
Other, net		280			167			261

Income tax expense	$	36,312		$	4,370		$	4,438

Components of deferred income tax assets and liabilities

The following table summarizes the components of deferred income tax assets and (liabilities):

	December 31,
	2014			2013

Loss carryforwards	$	39,217		$	21,092
AMT credits		112			112
Foreign tax credits		7,066			-
Accrued employment expenses		1,785			1,256
Amortization and write-offs		9,480			8,883
Capitalized R&D costs		2,663			2,933
Deferred revenues		-			84
Depreciation		2,022			4,360
Doubtful accounts		4,177			3,499
Inventory reserves		1,030			822
Tax on undistributed earnings		(3,333	)		-
Other accruals and reserves		324			228
Return allowances		2,787			5,660
Translation adjustments		(44)			61

Gross deferred tax asset		67,286			48,990

Less: valuation allowance		(65,957	)		(11,910	)

Net deferred tax asset	$	1,329		$	37,080

Among current assets	$	762		$	13,041
Among other non-current assets		567			24,039

Reconciliation of the beginning and ending amount of unrecognized tax benefits

Reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:


Balance at January 1, 2012	$	2,700
Additions / Settlements during 2012		(2,325	)
Balance December 31, 2012		375
Additions/ Settlements due 2013		269
Balance at December 31, 2013		644
Additions / Settlements due 2014		-
Balance at December 31, 2014	$	644