Note 11 - Income Taxes

12 Months Ended

Jun. 30, 2023

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%:

	2023			2022
Current income taxes	$	2,344		$	2,193
Deferred income tax expense (benefit)		(96	)		146
Total income tax expense	$	2,248		$	2,339

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

	2023			2022
Deferred tax assets:
Allowance for loan losses	$	1,622		$	1,504
Deferred compensation		986			999
Deferred income		31			18
Non-accrual loan interest income		20			29
Net unrealized securities loss		7,964			5,876
Other		3			6
Gross deferred tax asset		10,626			8,432
Deferred tax liabilities:
Depreciation		(783	)		(821	)
Loan fees		(640	)		(582	)
FHLB stock dividends		(102	)		(102	)
Prepaid expenses		(150	)		(150	)
Intangible assets		(199	)		(209	)
Gross deferred tax liabilities		(1,874	)		(1,864	)
Net deferred asset	$	8,752		$	6,568

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:

	2023			2022
Income taxes computed at the statutory rate on pretax income	$	2,714		$	2,842
Tax exempt income		(400	)		(431	)
Cash surrender value income		(55	)		(54	)
Tax credit		(17	)		(22	)
Other non-deductible expenses		6			4
Total income tax expense	$	2,248		$	2,339

The effective tax rate was 17.4% for the year ended June 30, 2023 compared to 17.3% for the year ended June 30, 2022. At June 30, 2023 and June 30, 2022, 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, 2023 and 2022 and there were no amounts accrued for interest and penalties at June 30, 2023 and 2022.

The Corporation and the Bank are subject to U.S. federal income tax as an income-based tax and a capital-based financial institutions tax in the State of Ohio. The Corporation and the Bank are no longer subject to examination by taxing authorities for years before 2019.