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Income Taxes | 12 Months Ended
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Dec. 31, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | Income TaxesThe Tax Cuts and Jobs Act ("Tax Act") was signed into law on December 22, 2017. Included as part of the law, was a permanent reduction in the federal corporate income tax rate from 35% to 21% effective January 1, 2018. Based upon the change in the tax rate, the Company revalued its net deferred tax asset at December 31, 2017. The current and deferred amounts of income tax expense (benefit) for the years ended December 31, 2020, 2019 and 2018 are as follows (in thousands):
| Years ended December 31,
| 2020 |  | 2019 |  | 2018
Current: |  |  |  |  |
Federal | $ | 27,143 |  |  | 22,427 |  |  | 41,578 |
State | 11,389 |  |  | 10,354 |  |  | 2,493 |
Total current | 38,532 |  |  | 32,781 |  |  | 44,071 |
Deferred: |  |  |  |  |
Federal | (5,908) |  |  | 1,650 |  |  | (17,302) |
State | (2,021) |  |  | 24 |  |  | (1,239) |
Total deferred | (7,929) |  |  | 1,674 |  |  | (18,541) |
| $ | 30,603 |  |  | 34,455 |  |  | 25,530 |
The Company recorded a deferred tax expense (benefit) of $5.2 million, $6.6 million and ($2.4) million during 2020, 2019 and 2018, respectively, related to the unrealized gains (losses) on available for sale debt securities, which is reported in accumulated other comprehensive income (loss), net of tax. Additionally, the Company recorded a deferred tax expense (benefit) of $1.4 million, ($463,000) and $379,000 in 2020, 2019 and 2018, respectively, related to the amortization of post-retirement benefit obligations, which is reported in accumulated other comprehensive income (loss), net of tax. A reconciliation between the amount of reported total income tax expense and the amount computed by multiplying the applicable statutory income tax rate is as follows (in thousands):
| Years ended December 31,
| 2020 |  | 2019 |  | 2018
Tax expense at statutory rates | $ | 26,786 |  |  | 30,889 |  |  | 30,223 |
Increase (decrease) in taxes resulting from: |  |  |  |  |
State tax, net of federal income tax benefit | 7,400 |  |  | 8,197 |  |  | 1,002 |
Tax-exempt interest income | (2,609) |  |  | (3,082) |  |  | (2,839) |
Bank-owned life insurance | (1,363) |  |  | (1,322) |  |  | (1,158) |
Other, net | 389 |  |  | (227) |  |  | (1,698) |
| $ | 30,603 |  |  | 34,455 |  |  | 25,530 |
The net deferred tax asset is included in other assets in the Consolidated Statements of Financial Condition. The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2020 and 2019 are as follows (in thousands):
| 2020 |  | 2019
Deferred tax assets: |  |  |
Allowance for credit losses on loans | $ | 26,156 |  |  | 14,313 |
Allowance for credit loss OBS | 1,295 |  |  | — |
Post-retirement benefit | 6,924 |  |  | 6,946 |
Deferred compensation | 839 |  |  | 1,175 |
Contingent Consideration | 714 |  |  | — |
Purchase accounting adjustments | 3,099 |  |  | 1,629 |
Depreciation | 331 |  |  | 750 |
SERP | 733 |  |  | 688 |
ESOP | 1,377 |  |  | 1,606 |
Stock-based compensation | 4,481 |  |  | 4,747 |
Payroll Protection Program fees | 2,268 |  |  | — |
Non-accrual interest | 225 |  |  | 417 |
Federal Net Operating Loss ("NOL") | 280 |  |  | 321 |
Net unrealized loss on hedging activities | 1,717 |  |  | — |
Pension liability adjustments | 376 |  |  | 1,821 |
Other | 925 |  |  | 1,223 |
Total gross deferred tax assets | 51,740 |  |  | 35,636 |
Deferred tax liabilities: |  |  |
Pension expense | 7,340 |  |  | 7,017 |
Deferred loan costs | 4,532 |  |  | 5,064 |
Investment securities, principally due to accretion of discounts | 79 |  |  | 70 |
Intangibles | 1,723 |  |  | 1,393 |
Originated mortgage servicing rights | 160 |  |  | 140 |
Unrealized gain on available for sale debt securities | 7,802 |  |  | 3,038 |
Net unrealized gain on hedging activities | — |  |  | 114 |
Total gross deferred tax liabilities | 21,636 |  |  | 16,836 |
Net deferred tax asset | $ | 30,104 |  |  | 18,800 |
Retained earnings at December 31, 2020 includes approximately $51.8 million for which no provision for income tax has been made. This amount represents an allocation of income to bad debt deductions for tax purposes only. Events that would result in taxation of these reserves include the failure to qualify as a bank for tax purposes, distributions in complete or partial liquidation, stock redemptions and excess distributions to stockholders. At December 31, 2020, the Company had an unrecognized tax liability of $13.4 million with respect to this reserve. As a result of the Beacon acquisition in 2011, the Company acquired federal net operating loss carryforwards. There are approximately $1.3 million of NOL carryforwards available to offset future taxable income as of December 31, 2020. If not utilized, these carryforwards will expire in 2031. Pursuant to the Tax Act, NOLs created after December 31, 2017 may be carried forward indefinitely and utilization is subject to 80% of taxable income. The federal NOLs are subject to a combined annual Code Section 382 limitation in the amount of approximately $197,000. Management has determined that it is more likely than not that it will realize the net deferred tax asset based upon the nature and timing of the items listed above. In order to fully realize the net deferred tax asset, the Company will need to generate future taxable income. Management has projected that the Company will generate sufficient taxable income to utilize the net deferred tax asset; however, there can be no assurance that such levels of taxable income will be generated. The Company’s policy is to report interest and penalties, if any, related to unrecognized tax benefits in income tax expense. The Company did not have any liabilities for uncertain tax positions or any known unrecognized tax benefits at December 31, 2020 and 2019. The Company and its subsidiaries file a consolidated U.S. Federal income tax return. For tax periods prior to December 31, 2018, New Jersey tax law does not and has not allowed for a taxpayer to file a tax return on a combined or consolidated basis with another member of the affiliated group where there is common ownership. As a result of this enacted legislation that New Jersey effectuated on July 1, 2018, beginning in 2019, the Company and its subsidiaries is required to file a combined New Jersey state income tax return on apportioned and allocated income. Also, the Company and its subsidiaries file a combined New York State income tax return on apportioned and allocated income. The Company, through its bank subsidiary, files a Pennsylvania Mutual Thrift Institution Tax return. The Company's Federal and New York State income tax returns are open for examination from 2017, the New Jersey State income tax returns are open for examination from 2016, and the Pennsylvania Mutual Thrift Institutions return is open from 2017. During the fourth quarter of 2017, the Internal Revenue Service completed its examination of the Company's 2014 Federal tax return. The completion of the examination did not have a material impact on the Company's effective income tax rate. The examination of the Company's 2016 and 2015 New York State tax returns was completed in the first quarter of 2019, and did not have a material impact on the Company's effective income tax rate. The Company's 2017 and 2018 New York State returns are currently under audit.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
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