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Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes

(12) INCOME TAXES

The components of the Company’s income tax expense (benefit) are as follows:

 

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2022

 

 

 

(Dollars in thousands)

 

Current taxes:

 

 

 

 

 

 

 

 

 

Federal

 

$

52,626

 

 

$

53,247

 

 

$

39,197

 

State

 

 

8,504

 

 

 

7,023

 

 

 

4,813

 

Deferred taxes

 

 

(2,203

)

 

 

(2,787

)

 

 

322

 

Total income taxes

 

$

58,927

 

 

$

57,483

 

 

$

44,332

 

 

Income tax expense (benefit) applicable to securities transactions approximated $20,000, $(384,000) and $453,000 for the years ended December 31, 2024, 2023 and 2022, respectively.

A reconciliation of tax expense at the federal statutory tax rate applied to income before taxes is presented in the following table. The federal statutory tax rate was 21% in 2024, 2023 and 2022:

 

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2022

 

 

 

(Dollars in thousands)

 

Tax expense at the federal statutory tax rate

 

$

57,809

 

 

$

56,689

 

 

$

49,861

 

Increase (decrease) in tax expense from:

 

 

 

 

 

 

 

 

 

Tax-exempt income, net

 

 

(489

)

 

 

(343

)

 

 

(337

)

Modified endowment life contracts

 

 

(424

)

 

 

(497

)

 

 

(487

)

Share based compensation excess tax benefit

 

 

(3,557

)

 

 

(786

)

 

 

(2,905

)

Tax deductible dividends paid on ESOP

 

 

(511

)

 

 

(505

)

 

 

(481

)

State tax expense, net of federal tax benefit

 

 

6,162

 

 

 

4,945

 

 

 

3,788

 

Utilization of tax credits:

 

 

 

 

 

 

 

 

 

New markets tax credits, net of amortization

 

 

(777

)

 

 

(777

)

 

 

(3,745

)

Low-income housing tax credits, net of amortization

 

 

(1,226

)

 

 

(1,106

)

 

 

(1,024

)

Other tax credits, net of amortization

 

 

(397

)

 

 

(192

)

 

 

(91

)

Other, net

 

 

2,337

 

 

 

55

 

 

 

(247

)

Total tax expense

 

$

58,927

 

 

$

57,483

 

 

$

44,332

 

 

The net deferred tax asset consisted of the following and is reported in other assets:

 

 

 

December 31,

 

 

 

2024

 

 

2023

 

 

 

(Dollars in thousands)

 

Unrealized net losses on securities

 

$

10,191

 

 

$

15,473

 

Provision for credit losses

 

 

23,598

 

 

 

22,782

 

Write-downs of other real estate owned

 

 

—

 

 

 

2,522

 

Deferred compensation

 

 

2,947

 

 

 

2,116

 

Stock-based compensation

 

 

2,178

 

 

 

2,199

 

Investments in partnership interests

 

 

8,319

 

 

 

7,260

 

Other

 

 

1,284

 

 

 

911

 

Gross deferred tax assets

 

 

48,517

 

 

 

53,263

 

Intangibles

 

 

(4,929

)

 

 

(5,639

)

Basis difference related to tax credits

 

 

(6,806

)

 

 

(5,462

)

Depreciation

 

 

(19,406

)

 

 

(21,833

)

Prepaid expense deducted

 

 

(1,243

)

 

 

(1,243

)

Other

 

 

(308

)

 

 

(181

)

Gross deferred tax liabilities

 

 

(32,692

)

 

 

(34,358

)

Net deferred tax asset

 

$

15,825

 

 

$

18,905

 

 

The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if applicable, in income tax expense. During the years ended December 31, 2024, 2023 and 2022, the Company did not recognize or accrue any interest and penalties related to unrecognized tax benefits. Federal and various state income tax statutes dictate that tax returns filed in any of the previous three reporting periods remain open to examination, which includes tax return years 2021 to 2023. The Company has no open examinations with either the Internal Revenue Service or any state agency.

Management performs an analysis of the Company’s tax position annually and believes it is more likely than not that all of its tax positions will be utilized in future years.