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, 2018

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):

	2018			2017
U.S. federal taxes (benefit) at statutory rate	$	(6,361	)	$	(7,867	)
State federal income tax benefit		(69	)		(21	)
Permanent differences		(24	)		87
Research and development credits		(608	)		(237	)
Change in valuation allowance due to operations		2,758			4,766
Acquisition-related permanent differences		—			2,281
Expiring state carryovers and other		4,304			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,
	2018			2017
Deferred tax assets
Net operating loss carryforward	$	19,941		$	13,797
Research and development credits		2,049			5,060
Deferred stock compensation		4,547			4,058
Deferred revenue		210			581
Other		404			254
Total deferred tax assets		27,151			23,750

Total deferred tax liabilities
Depreciable and amortizable assets		(925	)		(282	)
R&D intangible assets		(5,591	)		(5,591	)
Total deferred tax liabilities		(6,516	)		(5,873	)
Less: Valuation allowance		(20,635	)		(17,877	)
Net deferred tax assets	$	—		$	—

Schedule of Activity Related to Unrecognized Tax Benefits

The total amount of unrecognized benefits as of December 31, 2018 and 2017 was $0 million and $1.1 million, respectively. The reconciliation of unrecognized tax benefits at the beginning and end of the year is as follows:

(in thousands)	2018			2017
Gross unrecognized tax benefits at January 1,	$	1,143		$	—
Gross increases (decreases) related to acquisitions		(1,143	)		1,064
Gross increases related to current year tax positions		—			79
Gross unrecognized tax benefits at December 31,	$	—		$	1,143