Note (15)—Income taxes:

In connection with the initial public offering, as discussed in Note 1, the Company terminated its S-corporation status and became a taxable entity (“C corporation”) on September 16, 2016. As such, any periods prior to September 16, 2016 will only reflect an effective state income tax rate. The reported income tax expense for the year ended December 31, 2016 reflects the increase in the deferred tax net liability of $13,181 from the conversion in the taxable status. The deferred tax net liability is the result of timing differences in the recognition of income/deductions for generally accepted accounting principles (“GAAP”) and tax purposes. The consolidated statements of income present unaudited pro forma statements of income for the year to date and for prior year periods.

Allocation of federal and state income taxes between current and deferred portions is as follows:

	December 31,
	2017		2016		2015
Current	$	14,629	$	12,476	$	1,321
Deferred		6,458		9,257		1,647
Total	$	21,087	$	21,733	$	2,968

The reconciliation of income taxes computed at the United States federal statutory tax rates to the provision for income taxes is as follows, for the periods presented:

	December 31,
	2017			2016			2015
Federal taxes calculated at statutory rate	$	25,720		$	5,061		$	—
Increase (decrease) resulting from:
State taxes, net of federal benefit		3,053			3,664			2,956
Revaluation of net deferred tax liability as a result of the Tax Cuts and Jobs Act		(5,894	)		—			—
Conversion as of September 16, 2016 to C Corporation		—			13,181			—
Benefit of equity based compensation		(310	)		(786	)		—
Permanent items		(1,402	)		(633	)		12
Other		(80	)		1,246			—
Income tax expense, as reported	$	21,087		$	21,733		$	2,968

The components of the net deferred tax liability at December 31, 2017 and 2016, are as follows:

	For the year ended
	December 31,
	2017			2016
Deferred tax assets:
Allowance for loan losses	$	6,264		$	8,516
Amortization of core deposit intangible		759			996
Compensation related		6,158			7,552
Unrealized loss on securities		988			2,462
Other		3,599			2,430
Subtotal		17,768			21,956
Deferred tax liabilities:
FHLB stock dividends		(550	)		(827	)
Depreciation		(4,115	)		(6,548	)
Mortgage servicing rights		(19,830	)		(12,558	)
Other		(5,131	)		(6,203	)
Subtotal		(29,626	)		(26,136	)
Net deferred tax liability	$	(11,858	)	$	(4,180	)

On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into law, among other things permanently reduced the corporate tax rate from 35 percent to 21 percent, effective for tax years beginning January 1, 2018. Under the guidance of ASC 740, “Income Taxes” (“ASC 740”), the Company revalued its net deferred tax assets on the date of enactment based on the reduction in the overall future tax benefit expected to be realized at the lower tax rate implemented by the new legislation. After reviewing the Company’s inventory of deferred tax assets and liabilities on the date of enactment and giving consideration to the future impact of the lower corporate tax rates and other provisions of the new legislation, the Company’s revaluation of its net deferred tax liabilities was $5,894, which was included in “income taxes” in the Consolidated Statements of Income. Although in the normal course of business the Company is required to make estimates and assumptions for certain tax items which cannot be fully determined at period end, the Company did not identify items for which the income tax effects of the Tax Act have not been completed as of December 31, 2017 and, therefore, considers its accounting for the tax effects of the Tax Act on its deferred tax assets and liabilities to be complete as of December 31, 2017.

In recording the impact of the conversion to a C corporation, the Company recorded a deferred income tax expense of $2,955 related to the unrealized gain on available for sale securities through the income statement in accordance with ASC 740-20-45-8; therefore, the amount shown in other comprehensive income has not been reduced by the above expense. This difference will remain in OCI until the underlying securities are sold or mature in accordance with the portfolio approach allowed under ASC 740.

Tax periods for all fiscal years after 2013 remain open to examination by the federal and state taxing jurisdictions to which the Company is subject.