Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Sources of income (loss) before income taxes

The sources of income (loss) before income taxes are as follows (in thousands):



	Years Ended December 31,
	2019			2018			2017
Domestic	$	(85,278	)	$	(59,212	)	$	(12,487	)
Foreign	46,128			(8,468		)	(16,866		)
Total	$	(39,150	)	$	(67,680	)	$	(29,353	)

Components of income taxes

Components of income taxes are as follows (in thousands):



	Years Ended December 31,
	2019			2018			2017
Current:
Federal	$	—		$	—		$	(166	)
State and local	2			65			116
Foreign	10,002			8,905			5,494
Deferred:
Federal	—			(346		)	(1,263		)
Foreign	(1,940		)	(5,906		)	(4,157		)
Total income tax expense	$	8,064		$	2,718		$	24

Reconciliation of the expected income tax expense on income (loss) before income taxes using the statutory federal income tax

A reconciliation of the expected income tax expense on income (loss) before income taxes using the statutory federal income tax rate of 21% for 2019 and 2018 and 35% for 2017 to income tax expense follows (in thousands):



	Years Ended December 31,
	2019			2018			2017
Expected income tax expense at 21% for 2019 and 2018 and 35% for 2017	$	(8,222	)	$	(14,213	)	$	(10,274	)
Foreign tax rate differential	(1,996		)	74			(2,914		)
Foreign tax differences	(327		)	4,703			(5,610		)
Global intangible low tax income inclusion	7,310			3,443			—
State and local taxes	2			65			116
Nondeductible expenses	865			1,604			4,308
Change in U.S. tax rate	—			—			77,410
Expired capital loss	—			—			1,114
Valuation allowance:
Valuation allowance on expiring capital losses	—			—			(1,114		)
Valuation allowance on operations	10,432			7,042			(63,012		)
Total income tax expense	$	8,064		$	2,718		$	24

Tax effects of the cumulative temporary differences resulting in the net deferred income tax asset (liability)

The tax effects of the cumulative temporary differences resulting in the net deferred income tax asset (liability) are as follows (in thousands):



	December 31,
	2019			2018
Deferred income tax assets:
Accrued expenses	$	1,588		$	1,126
Allowance accounts	6,161			6,415
Net operating loss carryforward	105,844			96,854
Equity method investment	35,292			35,292
Original issue discount	6,000			8,073
Interest limitation	10,132			5,845
Basis in identified intangibles	7,090			4,146
Tax credit carryforwards	5,070			5,345
Other	4,443			4,600
Total deferred income tax asset	181,620			167,696
Valuation allowance	(170,937		)	(160,505		)
Net deferred income tax asset	10,683			7,191
Deferred income tax liabilities:
Unbilled receivables	(1,949		)	—
Total deferred income tax asset, net	$	8,734		$	7,191

Aggregate changes in gross amount of unrecognized tax benefits

During 2019, 2018 and 2017, the aggregate changes in the Company’s total gross amount of unrecognized tax benefits are summarized as follows (in thousands):



	Years Ended December 31,
	2019		2018		2017
Beginning balance	$	447	$	447	$	1,299
Increases in unrecognized tax benefits – current year positions	—		—		59
Decreases in unrecognized tax benefits – prior year position	—		—		(911		)
Ending balance	$	447	$	447	$	447