Molecular Templates, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Schedule of Reconciliation of Income Taxes at Statutory Federal Income Tax Rate to Net Income Taxes

A reconciliation of income taxes at the statutory federal income tax rate to net income taxes included in the accompanying statements of operations is as follows (in thousands):

	2017			2016
U.S. federal taxes (benefit) at statutory rate	$	(7,867	)	$	(3,750	)
State federal income tax benefit		(21	)		10
Permanent differences		87			105
Research and development credits		(237	)		(339	)
Change in valuation allowance due to operations		4,766			3,974
Acquisition-related permanent differences		2,281			—
Expiring state carryovers and other		991			—
Change in valuation allowance due to Tax Act		(6,863	)		—
U.S. Statutory Rate Change due to Tax Act		6,863			—
Total	$	—		$	—

Schedule of Significant Components of Net Deferred Tax Assets

The tax effects of temporary differences that give rise to significant components of the net deferred tax assets are as follows (in thousands):

	December 31,
	2017			2016
Deferred tax assets
Net operating loss carryforward	$	13,797		$	10,446
Research and development credits		5,060		$	965
Deferred stock compensation		4,058		$	8
Deferred revenue		581			636
Other		254			9
Total deferred tax assets		23,750			12,064

Total deferred tax liabilities
Depreciable and amortizable assets		(282	)		(329	)
R&D intangible assets		(5,591	)		—
Total deferred tax liabilities		(5,873	)		(329	)
Less: Valuation allowance		(17,877	)		(11,735	)
Net deferred tax assets	$	—		$	—

Schedule of Activity Related to Unrecognized Tax Benefits

The total amount of unrecognized benefits as of December 31, 2017 and 2016 was $1.1 million and $0, respectively. The reconciliation of unrecognized tax benefits at the beginning and end of the year is as follows:

(in thousands)	2017		2016
Gross unrecognized tax benefits at January 1,	$	—	$	—
Gross increases (decreases) related to acquisitions		1,064		—
Gross increases (decreases) related to current year tax positions		79		—
Gross unrecognized tax benefits at December 31,	$	1,143	$	—