Annual report pursuant to Section 13 and 15(d)

INCOME TAXES

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INCOME TAXES
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
INCOME TAXES
NOTE 16 — INCOME TAXES
Income tax benefit (provision) included in our reported net loss consisted of the following (in thousands):
Year Ended December 31,
2022 2021 2020
Current:
Federal $ —  $ —  $ — 
State —  —  — 
Foreign —  —  — 
Total Current —  —  — 
Deferred:
Federal —  —  — 
State —  —  — 
Foreign —  —  — 
Total Deferred —  —  — 
Total income tax benefit (provision) $ —  $ —  $ — 
The sources of loss from operations before income taxes were as follows (in thousands):
Year Ended December 31,
2022 2021 2020
Domestic $ (36,591) $ (111,114) $ (202,831)
Foreign (13,219) (3,624) (7,865)
Total loss before income taxes $ (49,810) $ (114,738) $ (210,696)

The reconciliation of the federal statutory income tax rate to our effective income tax rate is as follows:
Year Ended December 31,
2022 2021 2020
Income tax benefit (provision) at U.S. statutory rate $ 10,460  $ 24,095  $ 44,246 
Share-based compensation (126) 1,352  — 
Executive compensation (3,688) (203) — 
Change in U.S. state tax rate (1,313) —  — 
Change in foreign tax rate 1,816  —  — 
U.S. state tax 792  4,333  8,563 
Change in valuation allowance (8,871) (29,648) (49,802)
R&D Credit 748  524  524 
Foreign rate differential 516  (74) (168)
Other (334) (379) (3,363)
Total income tax benefit (provision) $ —  $ —  $ — 
Significant components of our deferred tax assets and liabilities are as follows (in thousands):
December 31,
2022 2021
Deferred tax assets:
Capitalized costs $ 85,875  $ 75,315 
Compensation and benefits 8,860  12,403 
Lease liability 16,086  15,514 
Disallowed interest expense carryforward 3,510  — 
Net operating loss carryforwards and credits:
Federal 99,922  80,246 
State 16,142  13,406 
Foreign 11,023  5,687 
Other, net 7,080  2,993 
Deferred tax assets 248,498  205,564 
Less valuation allowance (211,157) (201,366)
Deferred tax assets, net of valuation allowance 37,341  4,198 
Deferred tax liabilities
Property and equipment (37,341) (4,198)
Net deferred tax assets $ —  $ — 
As of December 31, 2022, we had federal, state and international net operating loss (“NOL”) carryforwards of approximately $453.6 million, $303.9 million and $45.6 million, respectively. Approximately $495.9 million of these NOLs have an indefinite carryforward period. All other NOLs will expire between 2036 and 2040.
Due to our historical losses and other available evidence related to our ability to generate taxable income, we have established a valuation allowance to fully offset our federal, state and international deferred tax assets as of December 31, 2022 and 2021. We will continue to evaluate the realizability of our deferred tax assets in the future. The increase in the valuation allowance was approximately $9.8 million for the year ended December 31, 2022.
In addition, we experienced a Section 382 ownership change in April 2017. An analysis of the annual limitation on the utilization of our NOLs was performed in accordance with IRC Section 382. It was determined that IRC Section 382 will not materially limit the use of our NOLs over the carryover period. We will continue to monitor trading activity in our shares which could cause an additional ownership change. If the Company experiences a Section 382 ownership change, it could further affect our ability to utilize our existing NOL carryforwards.
As of December 31, 2022, the Company determined that it has no uncertain tax positions, interest or penalties as defined within ASC 740-10. The Company does not have unrecognized tax benefits. The Company does not believe that it is reasonably possible that the total unrecognized benefits will significantly increase within the next 12 months.
We are subject to tax in the U.S. and various state and foreign jurisdictions. Federal and state tax returns filed with each jurisdiction remain open to examination under the normal three-year statute of limitations.
Pursuant to ASC 740-30-25-17, the Company recognizes deferred tax liabilities associated with outside basis differences on investments in foreign subsidiaries unless the difference is considered essentially permanent in duration. As of December 31, 2022, the Company has not recorded any deferred taxes on unremitted earnings as the Company has no undistributed earnings and profits. If circumstances change in the foreseeable future and it becomes apparent that some or all of the undistributed earnings and profits will not be reinvested indefinitely, or will be remitted in the foreseeable future, a deferred tax liability will be recorded for some or all of the outside basis difference.