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INCOME TAXES
 6 Months Ended
Jun. 30, 2020
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
The Company files income tax returns in the U.S. federal jurisdiction, the Commonwealth of Pennsylvania and the State of Maryland. The Company is no longer subject to tax examination by tax authorities for years before 2016.
The following table summarizes income tax expense for the three and six months ended June 30, 2020 and 2019:

Three months ended June 30,Six months ended June 30,
2020201920202019
Current expense$427  $69  $455  $90  
Deferred expense874  41  1,885  252  
Income tax expense$1,301  $110  $2,340  $342  


The following table summarizes deferred tax assets and liabilities at June 30, 2020 and December 31, 2019:
(Dollars in thousands)June 30,
2020		December 31,
2019
Deferred tax assets:
Allowance for loan losses$4,056  $3,418  
Deferred compensation505  415  
Retirement and salary continuation plans2,429  2,357  
Share-based compensation620  631  
Off-balance sheet reserves270  234  
Nonaccrual loan interest740  697  
Net unrealized losses on AFS securities944  127  
Purchase accounting adjustments2,496  4,081  
Bonus accrual257  493  
Interest Rate Swaps441  —  
Low-income housing credit carryforward230  —  
Net operating loss carryovers1,645  1,872  
Other719  672  
Total deferred tax assets15,352  14,997  
Deferred tax liabilities:
Depreciation433  452  
Mortgage servicing rights557  694  
Purchase accounting adjustments1,356  1,599  
Other275  275  
Total deferred tax liabilities2,621  3,020  
Net deferred tax asset, included in other assets$12,731  $11,977  
At June 30, 2020, the Company had acquired federal and state net operating loss carryforwards of $11.1 million and $6.7 million, respectively, subject to annual loss limitation limits, that expire through 2037. A deferred tax asset is recognized for these carryforwards because the benefit is more likely than not to be realized.
FASB ASC 740, Income Taxes, (“ASC 740”) clarifies the accounting for income taxes by prescribing a minimum probability threshold that a tax position must meet before a financial statement benefit is recognized. The minimum threshold is defined in ASC 740 as a tax position that is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The tax benefit to be recognized is measured as the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740 was applied to all existing tax positions upon initial adoption. There was no liability for uncertain tax positions and no known unrecognized tax benefits at June 30, 2020 or December 31, 2019.