
	Year Ended
	February 1, 2020		February 2, 2019		February 3, 2018
Current income tax provision (benefit):
Federal	$	5,223	$	46,519	$	776
State	(1,937)		5,959		2
Foreign	(4,137)		3,322		(2,541)
Total current income tax provision (benefit)	(851)		55,800		(1,763)
Deferred income tax provision (benefit):
Federal	(125,892)		134,336		10,136
State	(9,382)		(6,567)		83
Foreign	(649,884)		(9,122)		9,606
Total deferred income tax provision (benefit)	(785,158)		118,647		19,825
Total provision (benefit) for income taxes	$	(786,009)	$	174,447	$	18,062

The Company consists of a Bermuda parent holding company with various foreign and U.S. subsidiaries. The applicable statutory rate in Bermuda is zero for the Company for fiscal 2020, 2019, and 2018. For purposes of the reconciliation between the provision (benefit) for income taxes at the statutory rate and the effective tax rate, a U.S. statutory tax rate of 21% for fiscal years 2020 and 2019, and a notional rate of 33.7% for fiscal 2018 is applied as follows:


	Year Ended
	February 1, 2020		February 2, 2019		February 3, 2018

Provision at U.S. statutory rate	$	167,660	$	(976)	$	152,134
State taxes, net of federal benefit	(9,878)		(9,652)		—
Difference in U.S. and non-U.S. tax rates	(181,625)		46,988		(137,419)
Foreign income inclusion in U.S.	13,736		167,093		—
Non-deductible compensation	6,196		13,215		—
Intellectual property transaction	(762,933)		93,777		—
Federal research and development credits	(42,604)		(29,503)		(21,620)
Uncertain tax positions	(3,913)		4,238		—
Change in valuation allowance	26,971		(110,921)		21,339
Other	381		188		3,628
Income tax provision (benefit)	$	(786,009)	$	174,447	$	18,062

The current year income tax benefit is primarily related to the recognition of a $763.0 million tax benefit for the intra-entity transfer of the majority of our intellectual property to a subsidiary in Singapore. This resulted in the recognition of a deferred tax asset and tax benefit of $659.0 million related to the Singapore tax basis in the intellectual property. In addition, the Company recognized $104.0 million of income tax benefit from the reversal of deferred tax liabilities primarily related to previously acquired intangible assets. The income tax expense for fiscal 2019 was primarily the result of restructurings involving the transfer of certain assets and intellectual property used in the business among various subsidiaries and represented the estimated U.S. tax to be paid currently and in future years on income generated from the intellectual property transfer. These transactions align the global economic ownership of the Company's intellectual property rights with its current and future business operations. The Company continues to evaluate potential changes to its legal entity structure in response to guidelines and requirements in various international tax jurisdictions where it conducts business.


	February 1, 2020		February 2, 2019
Deferred tax assets:
Net operating losses	$	105,925	$	134,598
Federal and California income tax credits	631,805		557,333
Intangible assets	632,537		—
Reserves and accruals	22,719		18,404
Share-based compensation	4,117		5,213
Lease liabilities	32,120		—
Gross deferred tax assets	1,429,223		715,548
Valuation allowance	(676,780)		(597,829)
Total deferred tax assets	752,443		117,719
Deferred tax liabilities:
Intangible assets	(69,771)		(185,973)
Fixed assets	(27,540)		(13,370)
Unremitted earnings of non-U.S. subsidiaries	(21,284)		(52,828)
Royalty income	—		(99,340)
Right of use assets	(25,290)		—
Total deferred tax liabilities	(143,885)		(351,511)
Net deferred tax assets (liabilities)	$	608,558	$	(233,792)

In assessing the realization of deferred tax assets across all jurisdictions, management considers whether it is more likely than not that some portion or all of the deferred assets will be realized. The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. As of February 1, 2020, the Company recorded a valuation allowance of $676.8 million which is an increase of $79.0 million from fiscal 2019. The Company provided a full valuation allowance against its federal and state research and development and other tax credits. Based on the available objectively verifiable positive and negative evidence, the Company determined that it is more likely than not that these tax credits and a limited amount of net operating losses will not be realized in the future. The Company also provided a valuation allowance against the deferred tax assets of a portion of its operations in Israel, which has cumulative losses in recent years and is not projecting sufficient future taxable income to realize the benefit of its deferred tax assets.

As of February 1, 2020, the Company had net operating loss carryforwards available to offset future taxable income of approximately $932.1 million, $597.4 million and $514.8 million for U.S. federal, state of California and foreign purposes, respectively. The federal carryforwards will begin to expire in fiscal year 2022, and the California carryforwards will begin to expire in fiscal year 2028, if not utilized before these years. The majority of the Company’s foreign losses carry forward indefinitely. The Company also had federal research and other tax credit carryforwards of approximately $310.7 million which will begin to expire in fiscal 2021. As of February 1, 2020, the Company also had California research tax credit carryforwards of approximately $440.5 million, which can be carried forward indefinitely. The Company also has research and other tax credit carryforwards of approximately $26.0 million in other U.S. states which will begin to expire in fiscal 2021 due to the statutes of limitation.

Utilization of the Company's U.S. federal and state net operating loss and credit carryforwards may be subject to annual limitations due to ownership change provisions by the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. Future changes in the Company's stock ownership, some of which are outside of the Company's control, could result in an ownership change under Section 382 and result in a limitation on US tax attributes. As of February 1, 2020, the Company had approximately $718.5 million and $120.4 million of federal net operating loss and tax credit carryforwards, respectively, in the U.S. subject to an annual limitation. The Company does not expect these limitations to result in any permanent loss of its tax benefits.


	Year Ended
	February 1, 2020		February 2, 2019		February 3, 2018
Unrecognized tax benefits as of the beginning of the period	$	158,323	$	23,252	$	23,793
Increases related to acquired tax positions	9,215		131,631		—
Increases related to prior year tax positions	1,789		1,836		—
Decreases related to prior year tax positions	(6,747)		(6,259)		—
Increases related to current year tax positions	7,614		11,154		2,776

Settlements	(443)		—		—
Lapse in the statute of limitations	(4,044)		(3,198)		(3,341)
Foreign exchange (gain) loss	1,121		(93)		24
Gross amounts of unrecognized tax benefits as of the end of the period	$	166,828	$	158,323	$	23,252

Included in the balances as of February 1, 2020 is $127.3 million of unrecognized tax benefit that would affect the effective income tax rate if recognized. Also, $146.6 million, $135.6 million and $8.6 million of the gross unrecognized tax benefits presented in the table above are offset against deferred tax assets in the consolidated balance sheets as of February 1, 2020, February 2, 2019 and February 3, 2018, respectively.

The amounts in the table above do not include the related interest and penalties. The amount of interest and penalties accrued was approximately $12.4 million, $15.1 million, and $17.2 million as of February 1, 2020, February 2, 2019, and February 3, 2018, respectively. The Company’s policy is to recognize these interest and penalties as a component of income tax expense. The consolidated statements of operations for fiscal 2020, 2019, and 2018 included $1.4 million, $2.7 million, and $2.3 million, respectively, of interest and penalties related to the unrecognized tax benefits.

The Company's major tax jurisdictions are the United States, the states of California and Massachusetts, China, India, Israel, Singapore, and Switzerland. The Company is subject to income tax audits by the respective tax authorities in all of the jurisdictions in which it operates. The examination of tax liabilities in each of these jurisdictions requires the interpretation and application of complex and sometimes uncertain tax laws and regulations. As of February 1, 2020, the Company is currently under examination in material jurisdictions including China, India, Israel, Singapore, and the United States for fiscal years 2008 through 2018.

The Company will continue to review its tax positions and provide for or reverse unrecognized tax benefits as issues arise. During the next 12 months, it is reasonably possible that the amount of unrecognized tax benefits could increase or decrease significantly due to changes in tax law in various jurisdictions, new tax audits and changes in the U.S. dollar as compared to foreign currencies within the next 12 months. Excluding these factors, uncertain tax positions may decrease by as much as $15.2 million from the lapse of the statutes of limitation in various jurisdictions during the next 12 months.

The Singapore Economic Development Board (“EDB”) initially granted a 10-year Pioneer Status in July 1999 to the Company’s Singapore subsidiary. In October 2004, the Company’s subsidiary in Singapore was granted a second incentive known as the Develop and Expansion Incentive (“DEI”), and in June 2006, the EDB agreed to extend the Pioneer status for 15 years to June 2014. The Company renegotiated with the Singapore government and in fiscal 2015, they extended the DEI tax credits to the Company until June 2019. The Company renegotiated again with the Singapore government and during the second quarter of fiscal 2020, they extended the DEI tax credits to the Company until June 2024. In order to retain these tax benefits in Singapore, the Company must meet certain operating conditions relating to, among other things, maintenance of a regional headquarters function, and research and development activities in Singapore.

Under the Israeli Encouragement law of “approved or benefited enterprise,” two branches of Marvell Israel (M.I.S.L) Ltd., the GTL branch and the cellular branch (formerly Marvell DSPC), are entitled to approved and benefited tax programs that include reduced tax rates and exemption of certain income, subject to various operating and other conditions. Income from the approved or benefited enterprises, with the exception of capital gains, is eligible up to fiscal 2027.

The Company’s principal source of liquidity as of February 1, 2020 consisted of approximately $648 million of cash, cash equivalents and short-term investments, of which approximately $421 million was held by subsidiaries outside of Bermuda. The Company has not recognized a deferred tax liability on $176 million of these assets as those amounts are deemed to be indefinitely reinvested. The Company plans to use such amounts to fund various activities outside of Bermuda, including working capital requirements, capital expenditures for expansion, funding of future acquisitions or other financing activities.