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Income Taxes | 12 Months Ended
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Dec. 31, 2016
Income Tax Disclosure [Abstract] |
Income Taxes | 13. Income Taxes The following is a summary of income tax expense for the years ended December 31, 2016, 2015, and 2014:
|  | 2016 |  |  | 2015 |  |  | 2014 |
Current – federal |  | $ | 6,181 |  |  | $ | 7,777 |  |  | $ | 8,471 |
Current – state |  |  | (33 | ) |  |  | 139 |  |  |  | 110 |
Deferred – federal |  |  | 1,023 |  |  |  | 376 |  |  |  | 733 |
Income tax expense |  | $ | 7,171 |  |  | $ | 8,292 |  |  | $ | 9,314 |
The components of the net deferred tax asset as of December 31, 2016 and 2015 are as follows:
|  | 2016 |  |  | 2015 |
Deferred tax assets: |  |  |  |  |  |  |  |
Allowance for loan losses |  | $ | 4,679 |  |  | $ | 4,799 |
Fair value adjustments – business combination |  |  | 2,530 |  |  |  | 1,661 |
Deferred compensation |  |  | 2,891 |  |  |  | 2,443 |
Impaired security valuation |  |  | 261 |  |  |  | 497 |
Net operating loss carryover |  |  | 627 |  |  |  | 1,137 |
Post-retirement benefits |  |  | 1,688 |  |  |  | 1,562 |
Unrealized loss on interest rate swap |  |  | 161 |  |  |  | 258 |
Nonaccrual loan interest |  |  | 649 |  |  |  | 762 |
Accrued expenses |  |  | 1,282 |  |  |  | 1,072 |
Deferred fees and costs |  |  | 629 |  |  |  | 388 |
Other |  |  | 465 |  |  |  | 442 |
|  |  | 15,862 |  |  |  | 15,021 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Unrealized gain on securities available for sale |  |  | 750 |  |  |  | 1,900 |
Premises and equipment |  |  | 2,258 |  |  |  | 1,737 |
Intangibles – section 197 |  |  | 4,735 |  |  |  | 4,558 |
Mortgage servicing rights |  |  | 487 |  |  |  | 337 |
Other |  |  | 23 |  |  |  | 19 |
|  |  | 8,253 |  |  |  | 8,551 |
Net deferred tax asset |  | $ | 7,609 |  |  | $ | 6,470 |
During 2014, the Corporation generated net capital losses of $36 which, if unable to be utilized, expire December 31, 2019. During 2015, the Corporation generated additional net capital losses of $222 which, if unable to be utilized, expire December 31, 2020. In 2016, the Corporation generated net capital gains of $70, resulting in cumulative net capital losses of $188 that expire December 31, 2020. The associated deferred tax assets of $66 and $90 as of December 31, 2016 and 2015, respectively, are included in other deferred tax assets. The Corporation determined that it was not required to establish a valuation allowance for deferred tax assets since management believes that the deferred tax assets are likely to be realized through a carry back to taxable income in prior years, future reversals of existing temporary differences, future net capital gains and future taxable income. The reconciliation of income tax attributable to pre-tax income at the federal statutory tax rates to income tax expense is as follows:
|  | 2016 |  |  | % |  |  | 2015 |  |  | % |  |  | 2014 |  |  | % |
Tax at statutory rate |  | $ | 9,699 |  |  |  | 35.0 |  |  | $ | 10,671 |  |  |  | 35.0 |  |  | $ | 11,336 |  |  |  | 35.0 |
Tax exempt income, net |  |  | (2,054 | ) |  |  | (7.4 | ) |  |  | (1,816 | ) |  |  | (6.0 | ) |  |  | (1,684 | ) |  |  | (5.2 | )
Bank owned life insurance |  |  | (379 | ) |  |  | (1.3 | ) |  |  | (418 | ) |  |  | (1.4 | ) |  |  | (364 | ) |  |  | (1.1 | )
Merger costs |  |  | 170 |  |  |  | 0.6 |  |  |  | 30 |  |  |  | 0.1 |  |  |  | 0 |  |  |  | 0.0 |
Other |  |  | (265 | ) |  |  | (1.0 | ) |  |  | (175 | ) |  |  | (0.5 | ) |  |  | 26 |  |  |  | 0.1 |
Income tax expense |  | $ | 7,171 |  |  |  | 25.9 |  |  | $ | 8,292 |  |  |  | 27.2 |  |  | $ | 9,314 |  |  |  | 28.8 |
At December 31, 2016 and 2015, the Corporation has no unrecognized tax benefits. The Corporation does not expect the total amount of unrecognized tax benefits to significantly increase in the next twelve months. The Corporation recognizes interest and/or penalties related to income tax matters as part of income tax expense. At December 31, 2016 and 2015, there were no amounts accrued for interest and/or penalties and no amounts recorded as expense for the years ending December 31, 2016, 2015 and 2014. The Corporation and its subsidiaries are subject to U.S. federal income tax as well as income tax of the Commonwealth of Pennsylvania. The Corporation is no longer subject to examination by the taxing authorities for years prior to 2013. Tax years 2013 through 2015 remain open to federal and state examination. In connection with its acquisition of FC Banc Corp., the Corporation assumed a federal net operating loss carryforward of $6,367, which expires in 2033. Under Section 382 of the Internal Revenue Code, the utilization of the loss carryforward in future years is limited based on the consideration paid and other factors. The annual limitation on the utilization of this loss carry forward is $1,455. As of December 31, 2016, the balance of the net operating loss carryforward is $1,793. Management believes that the net operating loss carryforward will be used in full before its expiration.

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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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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