Income Taxes |
9 Months Ended |
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Sep. 30, 2024 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes |
NOTE 7 — Income Taxes
For the three months ended September 30, 2024, and 2023, the Company recorded provisions for income taxes of $117 and $96, respectively. For the nine months ended September 30, 2024, and 2023, the Company recorded provisions for income taxes of $279 and $281, respectively. The Company’s effective income tax rate is negative 2.5% for the nine months ended September 30, 2024, compared to 23.3% for the nine months ended September 30, 2023. The Company’s effective tax rate differs from the U.S. federal statutory tax rate primarily as a result of projected permanent items in the U.S.
The Company’s material income tax jurisdictions are the United States (federal and California), China and India. As a result of net operating loss and credit carryforwards, the Company is subject to audit for tax years 2012 and forward for federal and California purposes. The China and India tax years are open under the statute of limitations from 2013 and forward.
The Company is subject to ongoing tax examinations of its tax returns by the Internal Revenue Service and other tax authorities in various jurisdictions. In accordance with the guidance on the accounting for uncertainty in income taxes, the Company regularly assesses the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of its provision for income taxes. These assessments can require considerable estimates and judgments. As of September 30, 2024, the gross amount of unrecognized tax benefits was approximately $1.3 million. If the Company’s estimates of income tax liabilities prove to be less than the ultimate assessment, then a further charge to expense would be required. If events occur and the payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period in which we determine the liabilities are no longer necessary. The Company does not anticipate any material changes to its uncertain tax positions during the next twelve months.
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