Stamps.com 2002 Annual Report Download - page 59

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Table of Contents
STAMPS.COM INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
carryforwards. The tax effect of temporary differences that give rise to a significant portion of the deferred tax assets and liabilities at
December 31, 2002 and 2001 are presented below (in thousands).
2002 2001
Deferred tax assets (liabilities):
Net operating loss carryforwards $ 100,660 $ 98,999
Research credits 633 748
Other credits 114 —
Depreciation — 160
Capitalized start-up costs 1,268 1,995
Accruals 939 1,661
Total deferred tax assets 103,614 103,563
Valuation allowance (103,614 ) (103,563 )
Net deferred tax assets $ — $ —
Because the Company is uncertain as to when and if it may realize its deferred tax assets, the Company has placed a valuation allowance against
its otherwise recognizable deferred tax assets.
The Company has a net operating loss carryforward of $260.5 million and $207.1million for federal and state income tax purposes at
December31, 2002, respectively, and $251.4million and $231.5million for federal and state income tax purposes at December31, 2001,
respectively, which can be carried forward to offset future taxable income. The Company also has available a tax credit carryforward at
December31, 2002 of $915,000, which can be carried forward to offset future taxable liabilities. The Company’ s federal net operating loss will
begin to expire in 2018, state net operating loss will begin to expire in 2006. The federal credits begin to expire in 2018 and the state credits
will begin to expire in 2006. The Federal Tax Reform Act of 1986 and similar state tax laws contain provisions which may limit the net
operating losses carryforwards to be used in any given year upon the occurrence of certain events, including a significant change in ownership
interests. The provision for income taxes is comprised of (in thousands):
2002 2001 2000
Current
Federal $ —
$ —
$ —
State 2 4 1
2 4 1
Deferred —
—
—
Provision for income taxes $ 2 $ 4 $ 1
Differences between the provision for income taxes and income taxes at the statutory federal income tax rate are as follows (in thousands):
2002 2001 2000
Income tax at statutory federal rate $ (2,328 ) $ (71,255 ) $ (72,403 )
State income taxes, net of federal benefit (397 ) (12,227 ) (12,424 )
2003. EDGAR Online, Inc.