Shutterfly 2015 Annual Report Download - page 104
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The components of the (benefit from)/provision for income taxes are as follows (in thousands):
December 31,
2015 2014 2013
Federal:
Current ................................................. $ (23) $ (487) $ 1,181
Deferred ................................................ (2,053) (1,381) 1,870
(2,076) (1,868) 3,051
State:
Current ................................................. 768 704 1,711
Deferred ................................................ 91 (1,038) (1,234)
859 (334) 477
Foreign:
Current ................................................. 258 268 412
Deferred ................................................ (187) (185) (305)
71 83 107
Total income tax expense (benefit):
Current ................................................. 1,003 485 3,304
Deferred ................................................ (2,149) (2,604) 331
$ (1,146) $ (2,119) $ 3,635
The Company’s actual tax expense differed from the statutory federal income tax rate, as follows:
December 31,
2015 2014 2013
Income tax expense at statutory rate ........................... 35.0% 35.0% 35.0%
State income taxes ......................................... 142.6 20.1 (4.5)
Stock-based compensation .................................. 8.9 2.2 (15.2)
R&D tax credit ............................................ 173.5 14.8 (17.1)
Non-deductible executive compensation ........................ (116.5) (29.7) 20.6
Valuation allowance ....................................... (170.7) (17.2) 8.0
Other ................................................... (15.3) (4.0) 1.3
57.5% 21.2% 28.1%
At December 31, 2015, the Company had approximately $46.2 million, $43.6 million, and $16.8 million of
federal, California and other state jurisdictions net operating loss carryforwards, respectively, to reduce future
taxable income. $37.6 million, $35.5 million, and $2.8 million of the Federal, California, and other state
jurisdiction net operating loss carryforwards are associated with windfall tax benefits and will be recorded as
additional paid-in capital when realized. These carryforwards will expire beginning in the year 2023 and 2016 for
federal and California purposes, respectively, and no sooner than 2020 for the portion related to other state
jurisdictions, if not utilized.
The Company also had research and development credit carryforwards of approximately $12.3 million and
$12.9 million for federal and state income tax purposes, respectively, at December 31, 2015, of which $7.4
million and $2.5 million is associated with windfall tax benefits for federal and state income tax purposes,
respectively, that will be recorded as additional paid-in capital when realized. The research and development
credits may be carried forward over a period of 20 years for federal tax purposes, indefinitely for California tax
purposes, and 15 years for Arizona purposes. The research and development tax credit will expire starting in
2021 for federal and 2024 for Arizona.
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