Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

The components of the Company’s income tax expense (benefit) are as follows for the periods indicated below (dollars in thousands):

	Year Ended December 31,
	2018		2017			2016
Current federal income tax expense (benefit)	$	116	$	(575	)	$	575
Current state income tax expense (benefit)		35		(62	)		83
Deferred federal income tax expense (benefit)		1,009		1,046			(198	)
Deferred state income tax expense (benefit)		228		192			(2	)
Provision for Corporate Business Taxes	$	1,388	$	601		$	458

Reconciliation of Statutory Federal Rate to Effective Rate

The following is a reconciliation of the statutory federal rate to the effective rate, for the periods indicated below (dollars in thousands):

	Year Ended December 31,
	2018					2017					2016
Computed income tax (benefit) expense at federal rate	$	8,225		21.0	%	$	17,015		35.0	%	$	8,995		35.0	%
State taxes (benefit), net of federal tax, if applicable		222		0.6	%		115		0.2	%		50		0.2	%
Tax benefit due to federal rate change		-		-	%		(431	)	(0.9	)%		-		-	%
Permanent differences in taxable income from GAAP pre-tax income		-		0.5	%		-		-	%		140.0		0.6	%
Provision to return adjustment		181		-	%		(117.0	)	(0.2	)%		-		-	%
REIT income not subject to tax (benefit)		(7,240	)	(18.6	)%		(15,981	)	(32.9	)%		(8,727	)	(34.0	)%
Provision for Corporate Business Taxes/Effective Tax Rate^(A)	$	1,388		3.5	%	$	601		1.2	%	$	458		1.8	%

(A)	The provision for income taxes is recorded at the TRS level.

Current and Deferred Tax Liabilities and Assets

The Company’s consolidated balance sheets, at December 31, 2018, December 31, 2017 and December 31, 2016, contain the following current and deferred tax liabilities and assets, which are recorded at the TRS level (dollars in thousands):

	Year Ended December 31,
	2018			2017
Income taxes payable
Federal income taxes payable	$	116		$	-
State and local income taxes payable		35			-
Income taxes payable	$	151		$	-

	December 31, 2018			December 31, 2017
Deferred tax (assets) liabilities
Deferred tax - organizational expenses	$	(4	)	$	(10	)
Deferred tax - mortgage servicing rights		2,082			909
Deferred tax - net operating loss		-			(56	)
Total net deferred tax (assets) liabilities	$	2,078		$	843