Envestnet, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Income Taxes

Income Taxes

3 Months Ended

Mar. 31, 2021

The following table includes the Company’s income (loss) before income tax provision (benefit), income tax provision (benefit) and effective tax rate:


	Three Months Ended
	March 31,
		2021			2020
		(in thousands)
Income (loss) before income tax benefit		$	9,347		$	(9,154)
Income tax benefit		(5,588)			(1,964)
Effective tax rate		(59.8)		%	21.5		%

For the three months ended March 31, 2021, the Company’s effective tax rate differed from the statutory rate primarily due to the increase in the valuation allowance the Company has placed on a portion of its U.S. deferred tax assets, permanent book-tax differences, and the impact of state and local taxes offset by federal and state research and development (“R&D”) credits.

For the three months ended March 31, 2020, the Company's effective tax rate differed from the statutory rate primarily due to the increase in the valuation allowance the Company had placed on a portion of its US deferred tax assets offset by the windfall from stock-based compensation and the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) net operating loss carryback.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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