17.  Income Taxes

The components of loss from continuing operations before income taxes benefit were as follows:





The components of the income tax benefit were as follows:





A reconciliation of the United States federal statutory income tax rate to the Company’s effective income tax rate was as follows:



Net deferred tax assets consisted of the following:







As of December 31, 2017, the Company had net operating loss carryforwards for federal and state income tax purposes of $94,042 and $90,680, respectively, which begin to expire in fiscal year 2031 and 2020, respectively.

As of December 31, 2017, the Company had federal and state research and development tax credit carryforwards of $2,901 and $1,058, respectively, which begin to expire in fiscal year 2031 and until utilized, respectively. The Company has approximately $26,589 of foreign net operating loss carryforwards, which may be carried forward indefinitely.

Management of the Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets, which are comprised principally of net operating loss carryforwards and research and development credits. Under the applicable accounting standards, management has considered the Company’s history of losses and concluded that it is more likely than not that the Company will not recognize the benefits of its deferred tax assets. Accordingly, a full valuation allowance of the net deferred tax asset had been established at December 31, 2017 and 2016.

Utilization of the net operating loss and research and development credit carryforwards may be subject to a substantial annual limitation under Section 382 of the Internal Revenue Code of 1986 due to ownership change limitations that have occurred previously or that could occur in the future. These ownership changes may limit the amount of net operating loss and research and development credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively.

Changes in the valuation allowance for deferred tax assets during the years ended December 31, 2017, 2016 and 2015, were as follows:







The Company has not recorded any amounts for unrecognized tax benefits as of December 31, 2017 and 2016. The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates. The Company’s major taxing jurisdictions include the United States (federal and states) and Belgium. In the normal course of business, the Company is subject to examination by federal, state and foreign jurisdictions, where applicable. The Company’s tax years are still open under statute from 2014 to the present. The Company’s policy is to record interest and penalties related to income taxes as part of its income tax expense in the consolidated statements of operations.

The TCJA was enacted on December 22, 2017, a tax reform bill which, amount other items, reduces the current corporate federal tax rate to 21% from 35%. The rate reduction is effective January 1, 2018. ASC Topic 740, Accounting for Income Taxes (“ASC 740”), requires companies to recognize the effect of tax law changes in the period of enactment even though the effective date for most provisions is for tax years beginning after December 31, 2017, or in the case of certain other provisions of the law, January 1, 2018. Accordingly, the Company remeasured its United States deferred tax assets and liabilities as of December 31, 2017, to reflect the reduced rate that is expected to apply in future periods when these deferred taxes will reverse, resulting in an estimated reduction of the Company’s net deferred tax assets by approximately $20.3 million, which was offset by a corresponding change in the valuation allowance. The TCJA includes numerous provisions, such as limitation of deduction for executive compensation, that could impact the Company’s United States deferred tax assets, which are subject to a full valuation allowance.

The SEC issued Staff Accounting Bulletin No. 118 (“SAB 118”) on December 22, 2017. SAB 118 measurement period from a registrant’s reporting period that includes the TCJA’s enactment date to allow the registrant sufficient time to obtain, prepare and analyze information to complete the accounting required under ASC 740. Although the Company made a reasonable estimate of the gross amounts of the deferred tax assets disclosed, a final determination of the TCJA’s impact on the deferred tax assets and related valuation allowance requirements remains incomplete pending a full analysis of the provisions of the TCJA and their interpretations. The ultimate impact of the TCJA on the Company’s reported results in 2018 and beyond may differ from the estimates provided therein, possibly materially, due to, among other things, changes in interpretations and assumptions the Company has made, guidance that may be issues, and other actions the Company may take as a result of the TCJA, different from what presently contemplated.