Quarterly report pursuant to Section 13 or 15(d)

Income Taxes

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Income Taxes
9 Months Ended
Sep. 30, 2020
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Our tax provision for interim periods is determined using an estimated annual effective tax rate, adjusted for discrete events arising in each respective quarter. During each interim period, we update the estimated annual effective tax rate which is subject to significant volatility due to several factors, including our ability to accurately predict the income (loss) before provision for income taxes in multiple jurisdictions, the effects of acquisitions, the integration of those acquisitions, and changes in tax law. In circumstances where we are unable to predict income (loss) in multiple jurisdictions, the actual year to date effective tax rate may be the best estimate of the annual effective tax rate for purposes of determining the interim provision for income tax.
In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Tax. This update includes removal of certain exceptions to the general principles of ASC 740, Income taxes, and simplification in several other areas such as accounting for franchise tax (or similar tax) that is partially based on income. We early adopted the ASU in the second quarter of 2020. As a result, we recorded an additional income tax benefit of $0.9 million in the second quarter of 2020 due to the elimination of the year-to-date loss limitation rule that limited the interim period tax benefit.
We recorded a benefit from income tax of $1.6 million and $6.6 million for the three and nine months ended September 30, 2020, respectively. The effective tax rate was 14.4% and 23.2% for the three and nine months ended September 30, 2020 respectively.
We recorded a benefit from income tax of $2.0 million and $9.9 million for the three and nine months ended September 30, 2019, respectively. The effective tax rate was (31.8)% and 34.5% for the three and nine months ended September 30, 2019, respectively.
The decrease in the effective tax rate for the three months ended September 30, 2020 compared with the three months ended September 30, 2019 is primarily attributable to changes in distribution of income among jurisdictions with varying tax rates. The decrease in the effective tax rate for the nine months ended September 30, 2020 compared with the nine months ended September 30, 2019 is primarily attributable to the tax accounting effects of the sale of Medix included in the nine months ended September 30, 2019. Other significant factors that impact the effective tax rate are research and development credits and non-deductible executive compensation expenses.
We recorded an increase of $1.8 million related to unrecognized tax benefits for the three and nine months ended September 30, 2020. Within the next twelve months, it is possible that the uncertain tax benefit may change with a range of approximately zero to $2.4 million. Our tax returns remain open to examination as follows: U.S Federal, 2016 through 2019, U.S. states, 2015 through 2019, and significant foreign jurisdictions, generally 2015 through 2019.
For the three and nine months ended September 30, 2020, we have included our best estimate of the impact of COVID-19 pandemic to the estimated annual effective tax rate. Our estimated annual effective tax rate could be impacted by any changes in facts and circumstances or new information related to the COVID-19 pandemic.