eBay 1999 Annual Report Download - page 77

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Note 15—Income Taxes:
The components of income (loss) before income taxes for the years ended December 31, 1997, 1998 and 1999
are as follows, (in thousands):
Year Ended December 31,
1997 1998 1999
United States .......................................... $8,032 $12,062 $25,187
Foreign .............................................. — — (4,974)
$8,032 $12,062 $20,213
The provision for income taxes is composed of the following, (in thousands):
Year Ended December 31,
1997 1998 1999
Current:
Federal ............................................. $667 $2,419 $10,951
State and local ........................................ 207 963 2,683
874 3,382 13,634
Deferred:
Federal ............................................. 81 1,211 (3,347)
State and local ........................................ 16 196 (902)
97 1,407 (4,249)
$971 $4,789 $ 9,385
The following is a reconciliation of the difference between the actual provision for income taxes and the
provision computed by applying the federal statutory rate of 34% for 1997 and 1998 and 35% for 1999 to income
before income taxes, (in thousands):
Year Ended December 31,
1997 1998 1999
Provision at statutory rate ................................. $2,840 $ 4,255 $ 7,075
Permanent differences:
Foreign loss not recognized ............................ — — 1,741
S Corporation (income) loss not subject to tax .............. (2,307) (1,848) 978
Merger related expenses ............................... — 384 329
Stock-based compensation ............................. — 1,051 (379)
Tax-exempt interest income ............................ — (175) (4,223)
Other ................................................ 169 328 2,706
State taxes, net of federal benefit ............................ 269 794 1,158
$ 971 $ 4,789 $ 9,385
eBAY INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
72