INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

INCOME TAXES

Schedule of income tax expense (benefit)

The components of the Company’s income tax expense as of December 31 (in thousands):

	2020		2019
Current:
Federal	$	7,970	$	3,076
State and local		1,859		323
Total current tax expense		9,829		3,399
Deferred:
Federal		(1,392)		(1,338)
State and local		(280)		122
Valuation allowance		372		—
Total deferred (benefit) tax		(1,300)		(1,216)
Income tax expense	$	8,529	$	2,183

Schedule of reconciliation of income tax (expense) benefit

The following is a reconciliation of income taxes reflected on the Consolidated Statements of Income for the years ended December 31, 2020 and 2019 with income tax expense computed by applying the United States federal income tax rate of 21% to income before income taxes (in thousands):

	2020		2019
Income tax expense computed at 21% statutory rate	$	6,943	$	2,140
Differences:
Permanent differences		(57)		(30)
State taxes, net of federal expense		1,150		394
Low income housing investment		(36)		—
Valuation allowance		372		—
Other, net(1)		157		(321)
Income tax expense	$	8,529	$	2,183

(1) Includes the impact of R&D tax credits.

Schedule of principal components of deferred tax assets (liabilities)

The following were the principal components of the Company’s deferred tax items as of December 31 (in thousands):

	2020		2019
Deferred tax assets:
Net operating loss carryforwards	$	577	$	545
Allowance for loan losses		3,054		1,925
Deferred rent		635		797
Stock-based compensation		1,613		1,400
Provision on other real estate owned		484		438
Other intangible assets		615		723
Unrealized losses on securities, net		—		55
Accrued bonuses		898		474
Loan fees		244		352
Other		553		685
Total deferred tax assets		8,673		7,394
Deferred tax liabilities:
Goodwill		(1,013)		(1,354)
Depreciation		(904)		(961)
Unrealized gains on securities, net		(236)		—
Other		(92)		(32)
Total deferred tax liabilities		(2,245)		(2,347)
Net operating loss valuation allowance		(372)		—
Net deferred tax asset	$	6,056	$	5,047