Income Taxes

12 Months Ended

Dec. 31, 2024

Income Taxes [Abstract]

Income Taxes

(17) Income Taxes

The provision for income tax expense consisted of the following for the years ended December 31:

	2024		2023
Current:
Federal	$	4,525	$	5,349
State		2,678		3,147
		7,203		8,496
Deferred:
Federal		324		(400	)
State		279		(4	)
		603		(404	)
	$	7,806	$	8,092

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2024 and 2023, consisted of:

	2024		2023
Deferred tax assets:
Allowance for credit losses	$	4,903	$	5,246
Deferred compensation		45		64
Retirement compensation		1,575		1,617
Stock option compensation		467		453
Current state franchise taxes		578		657
Non-accrual interest		426		333
Lease liability		1,065		1,349
Investment securities unrealized loss		14,337		14,178
Other		394		281
Deferred tax assets		23,790		24,178
Deferred tax liabilities:
Fixed assets depreciation		761		970
FHLB dividends		184		184
Tax credit – loss on pass-through		824		489
Deferred loan costs		848		940
Mortgage servicing rights		388		383
Right of Use Asset		933		1,204
Postretirement benefits		129		21
Other		681		393
Total deferred tax liabilities		4,748		4,584
Net deferred tax assets (see Note 6)	$	19,042	$	19,594

Based upon the level of historical taxable income and projections for future taxable income over the periods during which the deferred tax assets are deductible, management believed it is more-likely-than-not the Company will realize the benefits of these deductible differences.

At December 31, 2024, the Company had no state net operating loss carry forwards and no federal tax credit carry forwards.

A reconciliation of income taxes computed at the federal statutory rate and the provision for income taxes for the years ended December 31, is as follows:

	2024			2023
Federal statutory income tax rate		21.0	%		21.0	%
Increase (decrease) in tax rate due to:
State franchise tax, net of federal benefit		8.4	%		8.4	%
Reduction for tax exempt interest		(1.5	)%		(1.2	)%
Cash surrender value of life insurance		(0.3	)%		(0.4	)%
Other		0.4	%		(0.5	)%
Effective income tax rate		28.0	%		27.3	%

Accounting for Uncertainty in Income Taxes

The Company had no unrecognized tax benefits for the years ended December 31, 2024 and 2023.  The Company recognized no changes in unrecognized tax benefits during 2024 and 2023, due to the expiration of a statute of limitations.  The Company had no significant uncertain tax positions as of December 31, 2024 and December 31, 2023.  The Company does not currently anticipate any significant increase or decrease in unrecognized tax benefits during 2025.

The Company classifies interest and penalties as a component of the provision for income taxes.  At December 31, 2024, there were no unrecognized interest and penalties.  The tax years ended December 31, 2023, 2022, and 2021 remain subject to examination by the Internal Revenue Service.  The tax years ended December 31, 2023, 2022, 2021, and 2020 remain subject to examination by the California Franchise Tax Board.  The deductibility of these tax positions will be determined through examination by the appropriate tax authorities or the expiration of the tax statute of limitations.