Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Components of Income Tax Provision

The components of the Company’s income tax provision for the years ended December 31, 2019 and 2018 are as follows:

	Year Ended December 31,
	2019			2018
Current income tax benefit	$	(14,678	)	$	(814,609	)
Deferred income tax expense (benefit)		21,664			(1,120,719	)
Provision for income taxes	$	6,986		$	(1,935,328	)

Schedule of Income Tax Provision Differs from Computed by Applying Federal Statutory Rate to Loss Before Income Taxes

The income tax provision differs from that computed by applying federal statutory rate to loss before income taxes for the years ended December 31, 2019 and 2018; those income tax rate differences are summarized as follows:

	Year Ended December 31,
	2019			2018
Expected tax provision at federal statutory rate	$	(48,713	)	$	(1,534,437	)
Tax exempt interest income		(48,428	)		(49,051	)
Dividends received deduction		(21,421	)		(23,438	)
Non-deductible conversion costs		136,439			-
Change in enacted tax rates		-			(343,929	)
Other		(10,891	)		15,527
Provision for income taxes	$	6,986		$	(1,935,328	)

Schedule of Deferred Income Taxes

At December 31, 2019 and 2018, the Company’s deferred income taxes consisted of the following:

	December 31,
	2019		2018
Deferred tax assets:
Discount of unearned premiums	$	487,274	$	530,428
Discount of advance premiums		85,139		55,638
Discount of losses and loss adjustment expenses		978,379		1,113,670
Guaranty fund assessment		40,890		36,027
Net operating loss carryforward		756,063		811,703
Capital loss carryforward		-		34,558
Unrealized loss on investments		-		250,592
Other		14,754		28
Total deferred tax assets		2,362,499		2,832,644
Deferred tax liabilities:
Deferred acquisition costs		542,742		836,891
TCJA transitional adjustment		224,943		314,446
Unrealized gain on investments		678,322		—
Accrual of bond market discount		19,070		3,338
Other		5,838		1,878
Total deferred tax liabilities		1,470,915		1,156,553
Deferred income taxes, net	$	891,584	$	1,676,091