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Income Taxes
12 Months Ended
Dec. 31, 2021
Income Taxes [Abstract]  
Income Taxes 11.INCOME TAXESPursuant to the accounting guidelines related to income taxes, the Company has evaluated its material tax positions as of December 31, 2021 and 2020. Under the “more-likely-than-not” threshold guidelines, the Company believes no significant uncertain tax positions exist, either individually or in the aggregate, that would give rise to the non-recognition of an existing tax benefit. In periods subsequent to December 31, 2021, determinations of potentially adverse material tax positions will be evaluated to determine whether an uncertain tax position may have previously existed or has been originated. In the event an adverse tax position is determined to exist, penalty and interest will be accrued, in accordance with the Internal Revenue Service (IRS) guidelines, and will be recorded as a component of other expenses in the Company’s consolidated statements of income.As of December 31, 2021, there were no unrecognized tax benefits that, if recognized, would significantly affect the Company’s effective tax rate. Also, there were no penalties and interest recognized in the consolidated statements of income in 2021, 2020 and 2019 as a result of management’s evaluation of whether an uncertain tax position may exist nor does the Company foresee a change in its material tax positions that would give rise to the non-recognition of an existing tax benefit during the forthcoming twelve months. Tax returns filed with the IRS are subject to review by law under a three-year statute of limitations. The Company has not received notification from the IRS regarding adverse tax issues for the current year or from tax returns filed for tax years 2020, 2019 or 2018. On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was signed into law. The bill reduced the Company’s federal corporate income tax rate from 34% to 21% effective January 1, 2018. The following temporary differences gave rise to the net deferred tax liability, a component of other assets in the consolidated balance sheets, as of the periods indicated: As of December 31,(dollars in thousands)2021 2020Deferred tax assets: Allowance for loan losses$ 3,281 $ 2,936Deferred interest from non-accrual assets 251 206Operating lease liabilities 2,022 1,605Acquisition accounting 2,087 479Other 1,029 594Total 8,670 5,820 Deferred tax liabilities: Net unrealized gains on available-for-sale securities (48) (2,380)Loan fees and costs (1,397) (1,013)Automobile leasing (5,162) (4,287)Operating lease right-of-use assets (1,891) (1,487)Depreciation (1,594) (1,411)Mortgage loan servicing rights (357) (278)Total (10,449) (10,856)Deferred tax liability, net$ (1,779) $ (5,036) The components of the total provision for income taxes for the years indicated are as follows: Years ended December 31,(dollars in thousands)2021 2020 2019 Current$ 4,904 $ 2,336 $ 1,985Deferred (903) (87) 341Total provision for income taxes$ 4,001 $ 2,249 $ 2,326 The reconciliation between the expected statutory income tax and the actual provision for income taxes is as follows: Years ended December 31, (dollars in thousands)2021 2020 2019Expected provision at the statutory rate$ 5,873 $ 3,203 $ 2,919Tax-exempt income (1,686) (865) (592)Bank owned life insurance (232) (167) (136)Nondeductible interest expense 87 54 37Nondeductible other expenses and other, net 49 (8) 98Tax credits (135) - -State income tax 45 32 -Actual provision for income taxes$ 4,001 $ 2,249 $ 2,326