XML 35 R18.htm IDEA: XBRL DOCUMENT

Income Taxes

12 Months Ended

Dec. 31, 2020

Note 10: Income Taxes

Income tax expense (benefit) for the years ending December 31, were as follows:



	2020		2019		2018
Current federal	$	6,269	$	4,815	$	-
Current state		3,960		1,151		84
Deferred federal		(135)		3,177		6,226
Deferred state		(511)		3,259		3,614
Total income tax expenses	$	9,583	$	12,402	$	9,924

The following were the components of the deferred tax assets and liabilities as of December 31:


	2020		2019
Allowance for credit losses	$	11,058	$	6,082
Deferred compensation		1,093		907
Goodwill amortization/impairment		2,212		3,456
Stock based compensation		1,356		1,622
Business combination adjustments		255		1,547
OREO write-downs		614		1,931
Federal recognized built-in loss ("RBIL") carryforward		142		340
State net operating loss and RBIL carryforward		60		326
Other assets		2,182		2,270
Total deferred tax assets		18,972		18,481

Accumulated depreciation on premises and equipment		(1,237)		(746)
Mortgage servicing rights		(1,261)		(1,779)
Amortization of core deposit intangible		(171)		(144)
State tax benefits		(930)		(927)
Other liabilities		(1,481)		(1,637)
Total deferred tax liabilities		(5,080)		(5,233)
Net deferred tax asset before adjustments related to other comprehensive income		13,892		13,248
Tax effect of adjustments related to other comprehensive income		(5,771)		(1,789)
Net deferred tax asset	$	8,121	$	11,459

At December 31, 2020, the Company no longer has federal nor state net operating loss carryforward. The Company had $674,000 of recognized built-in loss carryforward, which is below the $945,300 limitation per year under IRC Section 382.

The components of the provision for deferred income tax expense (benefit) for the years ending December 31, were as follows:



	2020		2019		2018
Provision for credit losses	$	(4,976)	$	(279)	$	(426)
Deferred compensation		(186)		(242)		(15)
Amortization of core deposit intangible		27		14		957
Stock based compensation		266		(245)		(511)
Business combination adjustments		1,292		985		927
OREO write-downs		1,317		406		48
Federal net operating loss and RBIL carryforward		198		1,859		5,041
State net operating loss and RBIL carryforward		266		3,708		2,986
Depreciation		491		303		59
Mortgage servicing rights		(518)		(431)		124
Goodwill amortization/impairment		1,244		1,242		1,389
State tax benefits		3		(912)		(550)
Other, net		(70)		28		(189)
Total deferred tax (benefit) expense	$	(646)	$	6,436	$	9,840

Effective tax rates differ from federal statutory rates applied to financial statement income for the years ended December 31, due to the following:


	2020		2019		2018
Tax at statutory federal income tax rate	$	7,856	$	10,890	$	9,227
Nontaxable interest income, net of disallowed interest deduction		(1,067)		(1,409)		(1,600)
BOLI income		(271)		(480)		(422)
State income taxes, net of federal benefit		2,570		3,496		2,927
Stock based compensation		297		(207)		(305)
Other, net		198		112		97
Total tax at effective tax rate	$	9,583	$	12,402	$	9,924

The Company evaluated positive and negative evidence in order to determine if it was more likely than not that the deferred tax asset would be recovered through future income. Significant positive evidence evaluated included recent and projected earnings, significantly improved asset quality and an improved capital position. No significant negative evidence was noted.

- 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 + Details