XML 39 R24.htm IDEA: XBRL DOCUMENT v3.22.0.1
Income Taxes
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The income tax expense (benefit) attributable to income from operations is summarized as follows:
(In thousands)CurrentDeferredTotal
2021
Federal$19,345 $1,485 $20,830 
State4,039 313 4,352 
Total$23,384 $1,798 $25,182 
2020
Federal$22,199 $(5,247)$16,952 
State4,009 (1,037)2,972 
Total$26,208 $(6,284)$19,924 
2019
Federal$15,161 $2,668 $17,829 
State2,782 405 3,187 
Total$17,943 $3,073 $21,016 

The primary reasons for the differences between income tax expense and the amount computed by applying the statutory federal income tax rate to earnings are as follows:

202120202019
Statutory federal income tax rate21.0 %21.0 %21.0 %
State income taxes, net of federal benefit3.0 2.4 2.5 
Tax exempt income(1.2)(1.8)(1.5)
Excess benefits from equity-based compensation(0.5)(0.2)(0.8)
Bank-owned life insurance income(0.4)(0.5)(0.5)
Federal tax credit0.0 (0.4)(0.7)
All other0.1 (0.1)0.5 
Total22.0 %20.4 %20.5 %
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.  Significant components of the Company’s deferred tax assets and liabilities as of December 31 were as follows:

(In thousands)20212020
Deferred tax assets:
Allowance for credit losses$11,160 $13,095 
Lease liability7,277 7,858
Interest income on nonperforming loans470 500 
Compensation and benefits12,303 11,580 
Purchase accounting adjustments360 0 
Liabilities held at fair value21 20 
Deferred loan fees and costs1,664 1,783 
Other1,017 1,097 
Total$34,272 $35,933 
Deferred tax liabilities:
Prepaid pension10,875 10,254 
Right of use asset7,092 7,270
Depreciation3,586 3,735 
Intangibles1,401 1,266 
Purchase accounting adjustments0 5 
Leases1,985 2,425 
   Other1,657 1,504 
Total deferred tax liabilities$26,596 $26,459 
Net deferred tax asset at year-end7,676 9,474 
Net deferred tax asset at beginning of year9,474 3,776 
(Decrease) increase in net deferred tax asset(1,798)5,698 
CECL accounting standard adoption recorded through equity0 586 
Deferred tax expense$1,798 $(6,284)

The above analysis does not include recorded deferred tax assets (liabilities) of $4.7 million and $(6.7) million as of December 31, 2021 and 2020, respectively, related to net unrealized holdings losses/(gains) in the available-for-sale debt securities portfolio. In addition, the analysis excludes recorded deferred tax assets of $13.4 million and $17.1 million, as of December 31, 2021 and 2020, respectively, related to employee benefit plans.

Realization of deferred tax assets is dependent upon the generation of future taxable income or the existence of sufficient taxable income. A valuation allowance is provided when it is more likely than not that some portion of the deferred tax assets will not be realized. In assessing the need for a valuation allowance, management considers the scheduled reversal of the deferred tax liabilities, the level of historical taxable income, and the projected future taxable income over the periods in which the temporary differences comprising the deferred tax assets will be deductible. Based on its assessment, management determined that no valuation allowance was necessary at December 31, 2021 and 2020.

At December 31, 2021 the Company had an insignificant amount of ASC 740-10 unrecognized tax benefits. At December 31, 2020, the Company had no ASC 740-10 unrecognized tax benefits. The Company does not expect the total amount of unrecognized tax benefits to significantly increase within the next twelve months. The Company recognizes interest and penalties on unrecognized tax benefits in income tax expense in its Consolidated Statements of Income.

The Company is subject to U.S. federal income tax and income tax in New York and various state jurisdictions. All tax years ending after December 31, 2017 are open to examination by the taxing authorities.