Quarterly report pursuant to Section 13 or 15(d)

Income Tax

v3.22.2.2
Income Tax
 9 Months Ended
Jun. 30, 2022
Income Tax  
Income Tax

12. Income Tax

 

The following table presents the provision for income taxes and our effective tax rate for the three and nine-month periods ended June 30, 2022 and 2021:

 

 

 

Three Months Ended,

June 30,

 

 

Nine Months Ended,

June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Provision for income tax expense (benefit)

 

 $ 96

 

 

 $ (29 )

 

 $ 59

 

 

 $ (307 )

Effective tax rate

 

 

 3 %

 

 

 3 %

 

 

 0 %

 

 

 9 %

 

The effective income tax rate on operations is based upon the estimated income for the year and adjustments, if any, in the applicable quarterly periods for the potential tax consequences, benefits, resolutions of tax audits or other tax contingencies.

 

Our effective tax rates for the three-month periods ended June 30, 2022 and 2021, are lower than the statutory rate primarily due to the effect of the valuation allowance on the net DTA position. Other than the deferred tax liability relating to indefinite lived assets, the Company is maintaining a valuation allowance against the remaining net DTA position. In addition, during the nine-month periods ended June 30, 2022 and 2021, the Company recognized non-taxable gains of $16,773 and $2,236, respectively, as discrete items from forgiveness and extinguishment of the Company’s PPP loans. The Company also incurred a discrete charge in the form of a noncash goodwill impairment charge of $2,150 during the nine-month period ended June 30, 2022.