XML 37 R23.htm IDEA: XBRL DOCUMENT

Income Taxes

12 Months Ended

Dec. 31, 2020

Note 14: Income Taxes

The Company files a consolidated federal income tax return. As of December 31, 2020 and 2019, retained earnings included approximately $17.5 million for which no deferred income tax liability had been recognized. This amount represents an allocation of income to bad debt deductions for tax purposes only for tax years prior to 1988. If the Bank were to liquidate, the entire amount would have to be recaptured and would create income for tax purposes only, which would be subject to the then-current corporate income tax rate. The unrecorded deferred income tax liability on the above amount was approximately $3.9 million at both December 31, 2020 and 2019, respectively.

During the years ended December 31, 2020, 2019 and 2018, the provision for income taxes included these components:


	2020		2019		2018

	(In Thousands)

Taxes currently payable	$	25,259	$	15,375	$	19,291
Deferred income taxes (benefit)		(11,480)		1,074		(4,450)

Income taxes	$	13,779	$	16,449	$	14,841

The tax effects of temporary differences related to deferred taxes shown on the statements of financial condition were:


	December 31,
	2020		2019

	(In Thousands)
Deferred tax assets
Allowance for loan losses	$	12,711	$	9,188
Interest on nonperforming loans		142		161
Accrued expenses		894		821
Write-down of foreclosed assets		131		185
Write-down of fixed assets		114		50
Income recognized for tax in excess of book		8,830		—
Partnership tax credits		11		732
Deferred income		885		509
Difference in basis for acquired assets and liabilities		1,532		2,540
		25,250		14,186

Deferred tax liabilities
Tax depreciation in excess of book depreciation		(5,988)		(5,986)
FHLB stock dividends		(368)		(817)
Prepaid expenses		(898)		(891)
Unrealized gain on available-for-sale securities		(6,869)		(2,671)
Unrealized gain on cash flow derivatives		(8,830)		(6,853)
Other		(258)		(233)
		(23,211)		(17,451)

Net deferred tax asset (liability)	$	2,039	$	(3,265)

Reconciliations of the Company’s effective tax rates from continuing operations to the statutory corporate tax rates were as follows:


	2020		2019		2018
Tax at statutory rate	21.0	%	21.0	%	21.0	%
Nontaxable interest and dividends	(0.5)		(0.5)		(0.8)
Tax credits	(3.8)		(3.6)		(3.4)
State taxes	1.4		1.3		1.1
Other	0.8		0.1		0.2

	18.9	%	18.3	%	18.1	%

The Company and its consolidated subsidiaries have not been audited recently by the Internal Revenue Service (IRS), except as described here. The Company, through one of its subsidiaries, is a partner in two partnerships which were under IRS examination for 2006 and 2007. As a result, the Company’s 2006 and subsequent tax years remained open for examination. The examinations of these partnerships were completed during 2019. The completion of these examinations did not result in significant changes to the Company’s tax positions. As a result, federal tax years through December 31, 2016 are now closed.

The Company is currently under State of Missouri income and franchise tax examinations for its 2014 and 2015 tax years. The Company does not currently expect significant adjustments to its financial statements from this state examination.

- 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