

	Year Ended December 31,
	2019			2018			2017
Current:
Federal	$	(6,584	)	$	(1,663	)	$	(15,412	)
State	(1,166		)	(269		)	(1,298		)
Foreign	11			—			6
	$	(7,739	)	$	(1,932	)	$	(16,704	)
Deferred:
Federal	(781		)	12			(5,256		)
State	(688		)	19			19
	(1,469		)	31			(5,237		)
Total income tax benefit	$	(9,208	)	$	(1,901	)	$	(21,941	)

For the fiscal years ended December 31, 2019, 2018 and 2017, we generated losses from continuing operations and recognized income from other financial statement categories such as “income from discontinued operations” and “other comprehensive income (loss)”. Under ASC 740-20-45-7 and applicable intra-period income tax allocation guidance, companies are required to consider all sources of income in determining the tax benefit to be recognized from its losses from continuing operations.

As a result of the required intra-period allocation, we recognized $7,675, $1,902 and $14,813 of tax benefits for our losses from continuing operations during the years ended December 31, 2019, 2018 and 2017, respectively. Tax charges equal to the tax benefits recognized within “loss from continuing operations” were recorded within “income from discontinued operations” on the accompanying Consolidated Statements of Operations for the years ended December 31, 2019, 2018 and 2017, and other comprehensive income (loss) on the accompanying Statements of Comprehensive Loss for the years ended December 31, 2019, 2018 and 2017.



	Year Ended December 31,
	2019			2018			2017
Tax provision computed at the federal statutory rate	$	(30,365	)	$	(26,854	)	$	(42,614	)
State tax, net of federal benefit	(4,126		)	(5,077		)	(2,207		)
Research and development expense tax credits	(2,526		)	(4,884		)	(1,176		)
Change in uncertain tax benefit reserve	—			—			(561		)
Change in tax credit carryforwards	81			(3,056		)	386
Officers compensation	1,506			600			(9,292		)
Stock based compensation	(230		)	(12,610		)	(2,734		)
Permanent items and other	267			(116		)	1,450
Tax differential on foreign earnings	(31		)	(32		)	33
Change in tax rate	1,126			(1,329		)	37,768
Refundable alternative minimum tax credit	—			—			(1,336		)
Change in prior year deferred taxes	1,170			6,595			(1,218		)
Valuation allowance	23,920			44,862			(440		)
Income tax benefit	$	(9,208	)	$	(1,901	)	$	(21,941	)

Significant components of our deferred tax assets and liabilities as of December 31, 2019 and 2018 are presented below. A valuation allowance has been recognized to offset the net deferred tax assets as realization of such deferred tax assets did not meet our “more-likely-than-not” assessment threshold, as required under GAAP.



	December 31,
	2019			2018
Deferred tax assets:
Net operating loss carry forwards	$	118,163		$	103,582
Research and development expense tax credits	22,724			21,618
Stock based compensation	4,385			5,057
Lease obligation	919			—
Development costs	704			3,938
Returns and allowances	1,069			1,976
Other, net	11,861			7,185
Total deferred tax assets before valuation allowance	159,825			143,356
Valuation allowance	(152,966		)	(131,042		)
Total deferred tax assets	6,859			12,314
Deferred tax liabilities, net:
Unrealized gains	(5,607		)	(9,387		)
Depreciation and amortization differences	(389		)	(4,396		)
Right-of-use asset	(863		)	—
Net deferred tax liabilities	$	—		$	(1,469	)

At December 31, 2019 and 2018, we recorded a valuation allowance of $153.0 million and $131.0 million, respectively. The valuation allowance increased by $21.9 million and $45.0 million during 2019 and 2018, respectively. The increase in the valuation allowance in 2019 and 2018 was due to an increase in net operating loss carryforwards and the reversal of deferred tax liabilities from our amortization of intangible assets which have no tax basis, partially offset by a $2.0 million valuation allowance release in 2019 related to our discontinued operations.

We had federal and state net operating loss carryforwards of approximately $497.0 million and $266.9 million, at December 31, 2019, respectively. We have approximately $5.2 million of foreign loss carryforwards that will begin to expire in 2028. The federal and state loss carry forwards began to expire in 2020 unless previously utilized. Federal loss carryforwards generated in 2018 and beyond will be carried forward indefinitely. At December 31, 2019, we had federal and state tax credits of approximately $15.9 million and $8.6 million, respectively. The federal tax credit carryovers begin to expire in 2027 unless previously utilized. The state research and development credit carryforwards have an indefinite carryover period.

Our utilization of certain net operating loss and research and development expense tax credit carryforwards, including those acquired in connection with the acquisition of Allos Therapeutics, Inc. in April 2012 and Talon Therapeutics, Inc. in July 2016, are subject to annual limitations under Sections 382 and 383 of the Internal Revenue Code of 1986 and similar state provisions. Any net operating losses or credits that would expire unutilized as a result of Section 382 and 383 limitations have been removed from the table of deferred tax assets and the accompanying disclosures of net operating loss and research and development carryforwards.



	Year Ended December 31,
	2019			2018			2017
Balance at beginning of year	$	3,248		$	2,715		$	3,271
Adjustments related to prior year tax positions	(392		)	(551		)	(39		)
Increases related to current year tax positions	692			1,084			374
Decreases due to expiration of tax statutes	(75		)	—			(891		)
Balance at end of year	$	3,473		$	3,248		$	2,715

We continue to believe that our tax positions meet the “more-likely-than-not” standard and as part of that analysis, we considered the amounts and probabilities from ultimate settlement with the tax authorities.

Approximately $0.1 million, $0.2 million, and $0.2 million of the total unrecognized tax benefits as of December 31, 2019, 2018, and 2017, respectively, would reduce our annual effective tax rate if recognized. Additional amounts in the summary rollforward could impact our effective tax rate if we did not maintain a full valuation allowance on our net deferred tax assets.

We do not expect our unrecognized tax benefits to change significantly over the next 12 months. With a few exceptions, we are no longer subject to U.S. federal, state and local income tax examinations for years before 2015. Our policy is to recognize interest and/or penalties related to unrecognized tax benefits in income tax expense in the Consolidated Statements of Operations.

On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act, or the Tax Act. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning in 2018, the transition of U.S international taxation from a worldwide tax system to a territorial system, which includes a new federal tax on global intangible low-taxed income (Global Minimum Tax, or GMT), and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. The Company calculated its best estimate of the impact of the Tax Act in its 2017 income tax provision in accordance with its understanding of the Tax Act and guidance available as of the date of the 10-K filing for the year ended December 31, 2017.

In addition, the SEC Staff issued SAB 118, which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Tax Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for certain income tax effects of the Tax Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act.

The provisional amounts were subject to revisions as we completed its analysis of the Tax Act, collected and prepared necessary data, and interpreted any additional guidance issued by the U.S. Treasury Department, Internal Revenue Service, or IRS, FASB, and other standard-setting and regulatory bodies. The measurement period expired as of December 31, 2018 and our accounting for the Tax Act is complete. The changes in 2018 to provisional amounts recorded in 2017 for the effects of the Tax Act were not material.