Note 11 - Income Taxes

12 Months Ended

Jun. 30, 2022

Notes to Financial Statements

Income Tax Disclosure [Text Block]

NOTE 11—INCOME TAXES

The provision for income taxes consisted of the following for the years ended June 30, calculated utilizing a statutory federal income tax rate of 21.0%:

	2022		2021
Current income taxes	$	2,193	$	2,170
Deferred income tax expense (benefit)		146		(320	)
Total income tax expense	$	2,339	$	1,850

The net deferred income tax asset (liability) consisted of the following components at June 30:

	2022			2021
Deferred tax assets:
Allowance for loan losses	$	1,504		$	1,317
Deferred compensation		999			896
Deferred income		18			32
Non-accrual loan interest income		29			54
Net unrealized securities loss		5,876			—
Other		6			1
Gross deferred tax asset		8,432			2,300
Deferred tax liabilities:
Depreciation		(821	)		(718	)
Loan fees		(582	)		(498	)
FHLB stock dividends		(102	)		(102	)
Prepaid expenses		(150	)		(56	)
Intangible assets		(209	)		(88	)
Net unrealized securities gain		—			(944	)
Gross deferred tax liabilities		(1,864	)		(2,406	)
Net deferred asset (liability)	$	6,568		$	(106	)

The difference between the provision for income taxes and amounts computed by applying the statutory income tax rate of 21.0% to income before taxes consisted of the following for the years ended June 30:

	2022			2021
Income taxes computed at the statutory rate on pretax income	$	2,842		$	2,276
Tax exempt income		(431	)		(360	)
Cash surrender value income		(54	)		(55	)
Tax credit		(22	)		(22	)
Other non-deductible expenses		4			11
Total income tax expense	$	2,339		$	1,850

The effective tax rate was 17.3% for the year ended June 30, 2022 compared to 17.1% for the year ended June 30, 2021. At June 30, 2022 and June 30, 2021, the Corporation had no unrecognized tax benefits recorded. The Corporation does not expect the total amount of unrecognized tax benefits to significantly increase within the next twelve months. There were no interest or penalties recorded for the years ended June 30, 2022 and 2021 and there were no amounts accrued for interest and penalties at June 30, 2022 and 2021.

The Corporation and the Bank are subject to U.S. federal income tax as an income-based tax and a capital-based franchise tax in the State of Ohio. The Corporation and the Bank are no longer subject to examination by taxing authorities for years before 2018.