Income Taxes

3 Months Ended

Mar. 31, 2020

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The provision for income taxes was $0.2 million for the first quarter of 2020 despite reporting a pretax loss. This result primarily reflects the impact of the geographic composition of our pretax loss, where the tax benefit from losses in the U.S was more than offset by the tax expense related to earnings from our international operations. The provision for income taxes was $1.8 million for the first quarter of 2019, reflecting an effective tax rate of 58%. The 2019 effective tax rate was negatively impacted by $0.7 million of discrete tax adjustments relative to the amount of pre-tax income.

The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted on March 27, 2020 in the United States. The CARES Act contains several tax provisions, including but not limited to additional carryback opportunities for net operating losses, temporary increases in the interest deductibility threshold, and the acceleration of refunds for any remaining alternative minimum tax (“AMT”) carryforwards. While there was no material impact from the CARES Act in our provision for income taxes for the first quarter of 2020, we are continuing to evaluate the provisions of the CARES Act and currently anticipate filing an amendment to our 2018 U.S. federal income tax return in the second quarter of 2020 to accelerate the refund of $0.7 million of AMT carryforwards.

The CARES Act also permits most companies to defer paying their portion of certain applicable payroll taxes from the date the CARES Act was signed into law through December 31, 2020. The deferred amount will be due in two equal installments on December 31, 2021 and December 31, 2022. While we anticipate deferrals of applicable payroll taxes through December 31, 2020, there were no deferrals at March 31, 2020.