Income Taxes

6 Months Ended

Jun. 30, 2021

Income Taxes [Abstract]

Income Taxes

7.     INCOME TAXES

The Company’s effective tax rate for the three and six-month periods ended June 30, 2021 were 22.0% and 21.4%, respectively, compared to 20.1% and 22.2% for the same periods in 2020, respectively. Effective rates are dependent upon components of pretax earnings and the related tax effects.

Income tax expense for the three and six-month periods ended June 30, 2021 and 2020 differed from the amounts computed by applying the U.S. federal tax rate of 21% to pretax income from continuing operations as demonstrated in the following table:

	For the Three-Months Ended
	June 30,
	2021		2020
Provision for income taxes at the statutory federal tax rates	$	151,435	$	205,528
Increase (reduction) in taxes resulting from:
Dividends received deduction		(7,967)		(7,161)
Tax-exempt interest income		(14,753)		(15,784)
Proration of tax-exempt interest and dividends received deduction		5,499		5,600
Nondeductible expenses		24,069		8,725
Officer life insurance, net		167		(170)
Total	$	158,450	$	196,738

	For the Six-Months Ended
	June 30,
	2021		2020
Provision for income taxes at the statutory federal tax rates	$	460,532	$	(321,768)
Increase (reduction) in taxes resulting from:
Dividends received deduction		(16,075)		(13,696)
Tax-exempt interest income		(29,547)		(31,264)
Proration of tax-exempt interest and dividends received deduction		11,063		10,968
Nondeductible expenses		42,095		14,228
Officer life insurance, net		333		633
Total	$	468,401	$	(340,899)

Management believes it is more likely than not that all deferred tax assets will be recovered as the result of future operations, which will generate sufficient taxable income to realize the deferred tax asset.

As of June 30, 2021 and December 31, 2020, the Company does not have any capital or operating loss carryforwards. Periods still subject to IRS audit include 2017 through current year. There are currently no open tax exams.