Income Taxes

12 Months Ended

Dec. 31, 2020

Income Taxes [Abstract]

Income Taxes

10. Income Taxes

Current and deferred income tax expense (benefit) provided for the years ended December 31 consisted of the following:

(in thousands)	2020			2019			2018
Current
Federal	$	12,174		$	14,798		$	2,517
State		9,005			7,733			6,224
Total Current		21,179			22,531			8,741
Deferred
Federal		(1,115	)		(3,500	)		5,622
State		(847	)		246			(160	)
Total Deferred		(1,962	)		(3,254	)		5,462
Total Provision for Taxes	$	19,217		$	19,277		$	14,203

The total provision for income taxes differs from the federal statutory rate as follows:

	2020						2019						2018
(in thousands)	Amount			Rate			Amount			Rate			Amount			Rate
Tax  Provision at Federal Statutory Rate	$	16,370			21.0	%	$	15,816			21.0	%	$	12,543			21.0	%
Interest on Obligations of States and Political Subdivisions exempt from Federal Taxation		(350	)		(0.4	%)		(358	)		(0.5	%)		(338	)		(0.5	%)
State and Local Income Taxes, Net of Federal Income Tax Benefit		6,445			8.3	%		6,304			8.4	%		4,791			7.9	%
Bank Owned Life Insurance		(444	)		(0.6	%)		(460	)		(0.6	%)		(434	)		(0.7	%)
Low-Income Housing Tax Credit		(2,655	)		(3.4	%)		(2,078	)		(2.8	%)		(1,624	)		(2.7	%)
Out of Period Adjustment		-			0.0	%		-			0.0	%		(802	)		(1.3	%)
Other, Net		(149	)		(0.2	%)		53			0.1	%		67			0.1	%
Total Provision for Taxes	$	19,217			24.7	%	$	19,277			25.6	%	$	14,203			23.8	%

The components of net deferred tax assets as of December 31 are as follows: The net deferred tax assets are reported in Interest Receivable and Other Assets on the Company’s Consolidated Balance Sheet.

(in thousands)	2020			2019
Deferred Tax  Assets
Allowance for Credit Losses	$	17,248		$	15,925
Accrued Liabilities		8,526			8,452
Deferred Compensation		13,707			14,200
State Franchise Tax		1,891			1,624
Tax Credit Carry Forward		-			1,266
Lease Liability		1,454			1,487
Acquired Net Operating Loss		643			673
Fair Value Adjustment on Loans Acquired		237			286
Fair Value Adjustment on ORE Acquired		108			108
PPP Loan Service Fee Income		1,367			-
Low-Income Housing Investment		384			286
Other		7			2
Total Deferred Tax Assets	$	45,572		$	44,309
Deferred Tax Liabilities
Premises and Equipment		(1,684	)		(1,974	)
Securities Accretion		(588	)		(370	)
Unrealized Gain on Securities Available-for-Sale		(5,156	)		(935	)
Leasing Activities		(17,183	)		(19,226	)
Core Deposit Intangible Asset		(1,186	)		(1,372	)
ROU Lease Asset		(1,428	)		(1,471	)
Prepaid		(45	)		(66	)
Other		(1,209	)		(898	)
Total Deferred Tax Liabilities		(28,479	)		(26,312	)
Net Deferred Tax Assets	$	17,093		$	17,997

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (CARES Act) was enacted in response to the COVID-19 pandemic. The CARES Act provides options for accelerating refunds associated with previously paid alternative minimum taxes. The Company benefited from the alternative minimum tax refund provisions of the CARES Act and submitted accelerated refund claims during the year ended December 31, 2020. Based upon the level of historical taxable income and projections for future taxable income over the periods during which the deferred tax assets are expected to be deductible, Management believes it is more likely than not we will realize the benefit of the remaining deferred tax assets.

The Company and its subsidiaries file income tax returns in the U.S. federal and California jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by the tax authorities for the years before 2016.