Income Taxes

The Company files income tax returns with the United States of America and the Commonwealth of Virginia. With few exceptions, the Company is no longer subject to federal, state, or local income tax examinations for years prior to 2012.

The net deferred tax asset at December 31, 2015 and 2014 consisted of the following components:



	December 31,
	2015		2014
	(in thousands)
Deferred tax assets:
Allowance for loan losses	$	1,678	$	1,727
Deferred compensation	116		120
Accrued postretirement benefits	47		47
Home equity origination costs	59		51
Interest rate swap	—		98
Other real estate owned valuation allowance	80		—
Nonaccrual interest	211		215
Other	120		176
	$	2,311	$	2,434
Deferred tax liabilities:
Property and equipment	$	812	$	405
Securities available for sale	522		756
	$	1,334	$	1,161
Net deferred tax asset	$	977	$	1,273

The Company has not recorded a valuation allowance for deferred tax assets because management believes that it is more likely than not that they will be ultimately realized.

Income tax expense for the years ended December 31, 2015, 2014 and 2013 consisted of the following components:



	December 31,
	2015		2014		2013
	(in thousands)
Current tax expense	$	2,001	$	1,926	$	1,198
Deferred tax expense	432		142		1,190
	$	2,433	$	2,068	$	2,388

The following table reconciles income tax expense to the statutory federal corporate income tax amount, which was calculated by applying the federal corporate income tax rate to pre-tax income for the years ended December 31, 2015, 2014 and 2013.



	December 31,
	2015			2014			2013
	(in thousands)
Statutory federal corporate tax amount	$	3,172		$	3,131		$	3,246
Tax-exempt interest (income)	(404		)	(454		)	(495		)
Officer insurance loss (income)	11			9			(82		)
Net tax credits	(105		)	(593		)	(312		)
Other	(241		)	(25		)	31
	$	2,433		$	2,068		$	2,388

The effective tax rates were 26.08%, 22.46%, and 25.02%, for years ended December 31, 2015, 2014, and 2013, respectively.