INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2025

Schedule of Components of Income Tax Expense Attributable to Income from Operations

For the years ended December 31, 2025 and 2024, income tax expense attributable to income from operations consisted of the following (in thousands):


	2025		2024
Current expense:
Federal	$	6,875	$	4,877
State	630		416
Total current	7,505		5,293
Deferred expense/(benefit):
Federal	(2,938)		1,029
State	(556)		92
Establishment of valuation allowance	821		—

Total deferred	(2,673)		1,121
Income tax expense	$	4,832	$	6,414

Schedule of Reconciliation of Income Tax Expense

Income tax expense differed from the amounts computed by applying the U.S. Federal statutory income tax rate to income before income tax expense as follows (in thousands, except percentages):


	2025
	Amounts		Percentages
Income taxes at the U.S. federal statutory tax rate	$	4,187	21.0	%
State and local income taxes, net of federal income tax impact (a)	134		0.7	%


Changes in valuation allowances	745		3.7	%
Nontaxable or nondeductible items
Municipal interest income	(360)		(1.8)	%
Other	91		0.5	%



Other adjustments	35		0.1	%
Total	$	4,832	24.2	%

(a) State taxes in New York made up the majority (greater than 50 percent) of the tax effect in this category.

Income tax expense differed from the amounts computed by applying the U.S. Federal statutory income tax rate to income before income tax expense as follows (in thousands) in accordance with the guidance prior to the adoption of ASU 2023-09:


	2024
Statutory federal tax rate	21		%
Tax computed at statutory rate	$	6,318
Increase (reduction) resulting from:
Tax-exempt income	(528)

Dividend exclusion	(10)
State taxes, net of Federal impact	437
Nondeductible interest expense	51

Other items, net	146
Income tax expense	$	6,414
Effective tax rate	21.3		%

Schedule of Income Taxes Paid

For the year ended December 31, 2025, the Corporation made the following income tax payments, net of refunds received:


	2025
U.S. federal taxes	$	5,950
State and local taxes
New York	398

Total income taxes paid	$	6,348

Schedule of Deferred Tax Assets and Deferred Tax Liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities as of December 31, 2025 and 2024, are presented below (in thousands):


Deferred tax assets:	2025		2024
Allowance for credit losses	$	6,534	$	5,858

Depreciation	1,334		1,122
Deferred compensation and directors' fees	1,656		1,444
Operating lease liabilities	1,253		1,435


Purchase accounting adjustment – fixed assets	154		154

Net unrealized losses on securities available for sale	12,484		22,487
Defined benefit pension and other benefit plans	448		527

Nonaccrued interest	381		381
Accrued expense	52		74
Capital loss carryforward	2,694		—
Other items, net	114		135
Total gross deferred tax assets	27,104		33,617

Deferred tax liabilities:
Deferred loan fees and costs	1,054		1,220
Prepaid pension	4,268		4,283

Discount accretion	195		163
Core deposit intangible	1,847		1,821
REIT dividend	1,107		775
Operating lease right-of-use assets	1,253		1,435
Accrual for employee benefit plans	15		11
Other items, net	285		241
Total gross deferred tax liabilities	10,024		9,949

Valuation allowance	821		—

Net deferred tax asset	$	16,259	$	23,668