December 2017,

“2017

2017

many changes to existing U.S. tax laws that impact the Company, most notably a reduction of the U.S. corporate income tax rate from to for tax years beginning after The Tax Act also provides for a -time transition tax on certain foreign earnings and the acceleration of depreciation for certain assets placed into service after as well as prospective changes beginning in including repeal of the domestic manufacturing deduction, acceleration of tax revenue recognition, capitalization of research and development expenditures, additional limitations on executive compensation and limitations on the deductibility of interest.

2017

2017

No.

118,

740,

period in which the Tax Act was signed into law. As such, the Company’s financial results reflect the income tax effects of the Tax Act for which the accounting under ASC Topic is complete and provisional amounts for those specific income tax effects of the Tax Act for which the accounting under ASC Topic is incomplete but a reasonable estimate could be determined. The ultimate impact of the Tax Act on our financial statements and related disclosures for and beyond differ from our current provisional amounts, possibly materially, due to, among other things, changes in interpretations and assumptions we have made, guidance that be issued, and other actions we take as a result of the Tax Act that differ from those presently contemplated.

2017

Company’s federal income taxes are as follows:

Reduction of the U.S. Corporate Income Tax Rate

 

’s deferred tax assets and liabilities were remeasured to reflect the reduction in the U.S. corporate income tax rate from to resulting in a million increase in income tax expense for the year ended and a corresponding million decrease in net deferred tax assets as of

loss before income taxes for the years ended in thousands):

Company’s components of the consolidated provision for income taxes for the years ended (in thousands):

’s valuation allowance for the years ended in thousands):

December 31:

December 31 (

December 31,

201

and the Company recognized a tax benefit of million and million, respectively, for research and development credits pertaining to the Company’s development of software that enables parties to interact, initiate functions or review data on the Company’s system.

December 31,

201

and the Company had federal net operating loss carryforwards remaining of approximately million and million, respectively.

’s federal net operating loss carryforwards of approximately million will begin to expire in various years beginning in The state net operating losses of approximately million can be used for a period of to years and vary by state, and if unused, begin to expire in though a substantial portion expires beyond Tax benefits of operating loss and tax credit carryforwards are evaluated on an ongoing basis, including a review of historical and projected future operating results, the eligible carryforward period, and other circumstances. The Company recorded a full valuation allowance for tax benefits of operating loss and tax credit carryforwards, which is described in more detail below.

’s realization of its deferred tax assets is dependent upon many factors, including, but limited to, the Company’s ability to generate sufficient taxable income. Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. As of the Company established a full valuation allowance for all deferred tax assets, as management determined that it is more likely than the Company will recognize the benefits of its federal and state deferred tax assets. Cumulative losses in recent years and assurance of future taxable income is the basis for the Company’s assessment that the deferred tax assets require a full valuation allowance. A valuation allowance of million has been established at

s for the years ended and

The Federal income tax returns of the Company for the years through are subject to examination by the Internal Revenue Service. The state income tax returns and other state tax filings of the Company are subject to examination by the state taxing authorities, for various periods generally up to years after they are filed. Canadian income tax returns of the Company for the years through are subject to examination by the Canada Revenue Agency.

he Company completed an update to its analysis of past ownership (as defined under Section of the Code), and as a result, the Company believes that, consistent with previously completed analyses, it has experienced an ownership change since The Company has undertaken a definitive analysis necessary to quantify the effect of ownership change as of on the net operating loss carryforwards generated prior to Based on the analysis, the Company is subject to an annual limitation of million on its use of

remaining pre-ownership change net operating loss carryforwards of million (and certain other pre-change tax attributes).