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STAMPS.COM INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
As of December 31, 2014, we have approximately $54 million of net deferred tax assets and we do not have any valuation allowance.
In making these determinations, we considered the available positive and negative evidence, including our recent earnings trend, expected future
income and the federal and state effective tax rates related to the future income.
Under the guidance related to uncertain tax positions, we are required to determine whether it is more likely than not that a tax position will be
sustained upon examination based on the technical merits of the position. A tax position that meets the more likely than not recognition threshold
is measured to determine the amount of liability or benefit to recognize in the financial statements.
In accordance with the guidance we have evaluated our research and development tax credits for uncertain tax positions. As of December 31,
2014 we have research and development tax credits totaling $3.5 million, net of unrecognized tax benefit for Federal and California purposes.
The following is a tabular reconciliation of the total amounts of unrecognized tax benefits for the years ended December 31, 2014, 2013 and
2012 (in thousands):
Our policy is to recognize interest and penalties expense, if any, related to unrecognized tax benefits as a component of income tax expense. As
of December 31, 2014, we have not recorded any interest and penalty expense.
We remain subject to examination by the relevant tax authorities. These include the 2011 through 2013 tax years for federal purposes and the
2010 through 2013 tax years for California purposes.
F-26
Table of Contents
Unrecognized
Tax Benefits
Balance at December 31, 2011
$
(1,745
)
Reduction for tax positions of prior years
—
Addition for tax position of the current year
(160
)
Settlement
—
Balance at December 31, 2012
$
(1,905
)
Reduction for tax positions of prior years
—
Addition for tax position of the current year
(409
)
Settlement
—
Balance at December 31, 2013
$
(2,314
)
Additions for tax positions of prior years
(2,349
)
Additions for tax position of the current year
(560
)
Settlement
—
Balance at December 31, 2014
$
(5,223
)