Tax Credit Investments

12 Months Ended

Dec. 31, 2019

Tax Credit Investments

Tax Credit Investments

Note 15: Tax Credit Investments

The Company invests in qualified affordable housing projects and federal historic projects for the purpose of community reinvestment and obtaining tax credits. The Company’s tax credit investments are limited to existing lending relationships with well-known developers and projects within the Company’s market area.

The following table presents a summary of the Company’s investments in qualified affordable housing projects and other tax credit investments at December 31, 2019 and 2018:

		December 31, 2019				December 31, 2018
Investment	Accounting Method		Investment		Unfunded Commitment (1)		Investment		Unfunded Commitment
Low Income Housing Tax Credit (LIHTC)	Proportional Amortization	$	2,148		—	$	2,436	$	—
Federal Historic Tax Credit (FHTC)	Equity		2,262		3,395		1,814		3,226
Total		$	4,410	$	3,395	$	4,250	$	3,226

(1) All commitments are expected to be paid by the Company by December 31, 2020.

The following table presents a summary of the amortization expense and tax benefit recognized for the Company’s qualified affordable housing projects and other tax credit investments during 2019, 2018 and 2017.

	Amortization		Tax Benefit
	Expense (1)		Recognized (2)
Year Ended December 31, 2019
LIHTC	$	289	$	(330)
FHTC		3,225		(3,687)
Total	$	3,514	$	(4,017)
Year Ended December 31, 2018
LIHTC	$	310	$	(346)
FHTC		3,293		(3,782)
Total	$	3,603	$	(4,128)
Year Ended December 31, 2017
LIHTC	$	—	$	—
FHTC		1,916		(2,225)
Total	$	1,916	$	(2,225)

(1) The amortization expense for the LIHTC investments are included in income tax expense. The amortization for the FHTC tax credits are included in noninterest expense.

(2) All of the tax benefits recognized are included in income tax expense. The tax benefit recognized for the FHTC investments primarily reflects the tax credits generated from the investments, and excludes the net tax expense/benefit of the investments’ income/loss.