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INCOME TAXES (Tables)
12 Months Ended
Dec. 31, 2020
INCOME TAXES [Abstract]  
Provision for Income Taxes

The provision for income taxes consists of the following (in thousands):

 
Year Ended December 31,
 
   
2020
   
2019
   
2018
 
Currently payable
 
$
4,896
   
$
3,503
   
$
3,838
 
Deferred tax liability (asset)
   
367
     
317
     
(435
)
Provision for income taxes
 
$
5,263
   
$
3,820
   
$
3,403
 
Deferred Tax Assets and Liabilities

The following temporary differences gave rise to the net deferred tax asset and liabilities at December 31, 2020 and 2019, respectively (in thousands):

 
2020
   
2019
 
Deferred tax assets:
           
Allowance for loan losses
 
$
5,135
   
$
3,470
 
Deferred compensation
   
520
     
500
 
Merger & acquisition costs
   
2
     
-
 
Allowance for losses on available-for-sale securities
   
15
     
-
 
Pension and other retirement obligation
   
599
     
368
 
Unrealized loss on interest rate swap
   
2
     
-
 
Interest on non-accrual loans
   
778
     
726
 
Incentive plan accruals
   
489
     
418
 
Other real estate owned
   
16
     
-
 
Low income housing tax credits
   
131
     
135
 
NOL carry forward
   
1,321
     
83
 
Lease liability
   
482
     
-
 
Accrued vacation
   
187
     
-
 
Other
   
224
     
146
 
Total
 
$
9,901
   
$
5,846
 
                 
Deferred tax liabilities:
               
Premises and equipment
 
$
(612
)
 
$
(662
)
Investment securities accretion
   
(68
)
   
(70
)
Loan fees and costs
   
(333
)
   
(238
)
Goodwill and core deposit intangibles
   
(2,293
)
   
(2,248
)
Mortgage servicing rights
   
(215
)
   
(134
)
Unrealized gains on available-for-sale securities
   
(1,612
)
   
(630
)
Right of use asset
   
(480
)
   
-
 
Other
   
(245
)
   
(1
)
Total
   
(5,858
)
   
(3,983
)
Deferred tax asset, net
 
$
4,043
   
$
1,863
 
Reconciliation of Statutory Tax Rates to Effective Tax Rates

The total provision for income taxes is different from that computed at the statutory rates due to the following items (dollars in thousands):

 
Year Ended December 31,
 
   
2020
   
2019
   
2018
 
Provision at statutory rates on pre-tax income
 
$
6,377
   
$
4,895
   
$
4,502
 
Effect of tax-exempt income
   
(936
)
   
(920
)
   
(955
)
Low income housing tax credits
   
(141
)
   
(141
)
   
(141
)
Bank owned life insurance
   
(146
)
   
(131
)
   
(131
)
Nondeductible interest
   
44
     
52
     
41
 
Nondeductible merger and acquisition expenses
   
32
     
38
     
-
 
Other items
   
33
     
27
     
87
 
Provision for income taxes
 
$
5,263
   
$
3,820
   
$
3,403
 
Statutory tax rates
   
21
%
   
21
%
   
21
%
Effective tax rates
   
17.3
%
   
16.4
%
   
15.9
%