Aurora Innovation, Inc. Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

The components of income tax benefit were as follows (in millions):


	Twelve Months Ended December 31,
	2022		2021		2020




Deferred income benefit:
Federal	$	—	$	(4)	$	—
State	—		(1)		—
Total deferred income tax benefit	—		(5)		—
Income tax benefit	$	—	$	(5)	$	—

The reconciliations of the effective tax rate from the federal statutory rate were as follows:


	Twelve Months Ended December 31,
	2022		2021		2020
Federal statutory tax rate	21.0	%	21.0	%	21.0	%
State income tax, net of federal tax benefit	—		0.1		—
Stock-based compensation	(0.2)		(0.4)		(1.5)
Research and development credits	1.5		2.5		3.5
Liability classified financial instruments	1.4		(0.7)		—
Goodwill impairment	(13.6)		—		—
Other	(0.1)		(0.1)		0.2
Change in valuation allowance	(10.0)		(21.8)		(23.2)
Effective tax rate	—	%	0.6	%	—	%

The components of deferred tax assets and liabilities were as follows (in millions):


	As of
	December 31, 2022		December 31, 2021
Deferred tax assets:
Net operating losses	$	324	$	244
Tax credits	83		45
Stock-based compensation	17		41
Capitalized R&D	130		—

Lease liability	29		31
Other	14		12
Deferred tax assets, gross	597		373
Valuation allowance	(542)		(331)
Deferred tax assets, net of valuation allowance	55		42
Deferred tax liabilities:
Depreciation and amortization	(27)		(7)
Right of use asset	(29)		(32)
Other	(3)		(7)
Deferred tax liabilities	(59)		(46)
Deferred tax liabilities, net	$	(4)	$	(4)

The components of changes in the valuation allowance were as follows (in millions):


	Twelve Months Ended December 31,
	2022		2021		2020
Valuation allowance at beginning of period	$	331	$	87	$	31
Change in deferred tax asset positions	211		244		56

Valuation allowance at end of period	$	542	$	331	$	87

The components of changes in unrecognized tax benefits were as follows (in millions):


	Twelve Months Ended December 31,
	2022		2021		2020
Unrecognized tax benefits at beginning of period	$	18	$	5	$	2
Increases related to tax positions taken during a prior year	1		1		—
Increases related to tax positions taken during the current year	8		12		3
Decreases related to tax positions taken during a prior year	(6)		—		—
Unrecognized tax benefits at end of period	$	21	$	18	$	5