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Income Taxes | 12 Months Ended
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Dec. 31, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES The provision for income taxes for the years ended December 31, 2020, 2019, and 2018 consisted of the following (in thousands):
|  | Federal |  | State |  | Total
2020 |  |  |  |  |  |
Current |  | $ | 4,915 |  |  | $ | 3,050 |  |  | $ | 7,965 |
Deferred |  | (656) |  |  | (395) |  |  | (1,051) |
Provision for income taxes |  | $ | 4,259 |  |  | $ | 2,655 |  |  | $ | 6,914 |
2019 |  |  |  |  |  |
Current |  | $ | 5,747 |  |  | $ | 3,351 |  |  | $ | 9,098 |
Deferred |  | (387) |  |  | (202) |  |  | (589) |
Provision for income taxes |  | $ | 5,360 |  |  | $ | 3,149 |  |  | $ | 8,509 |
2018 |  |  |  |  |  |
Current |  | $ | 3,995 |  |  | $ | 2,689 |  |  | $ | 6,684 |
Deferred |  | (140) |  |  | 76 |  |  | (64) |
Provision for income taxes |  | $ | 3,855 |  |  | $ | 2,765 |  |  | $ | 6,620 |
Deferred tax assets (liabilities) consisted of the following (in thousands):
|  | December 31,
|  | 2020 |  | 2019
Deferred tax assets: |  |  |  |
Allowance for credit losses |  | $ | 3,818 |  |  | $ | 2,638 |
Deferred compensation |  | 4,729 |  |  | 4,490 |
Net operating loss carryovers |  | 2,148 |  |  | 2,266 |
Mark-to-market adjustment |  | 21 |  |  | 58 |
Other deferred tax assets |  | 303 |  |  | 374 |
Other-than-temporary impairment |  | 192 |  |  | 192 |
Loan and investment impairment |  | 851 |  |  | 1,158 |
Operating lease liabilities |  | 2,625 |  |  | 3,080 |
Partnership income |  | 105 |  |  | 200 |
State taxes |  | 674 |  |  | 692 |
Total deferred tax assets |  | 15,466 |  |  | 15,148 |
Deferred tax liabilities: |  |  |  |
Operating lease right-of-use assets |  | (2,423) |  |  | (2,878) |
Finance leases |  | (275) |  |  | (175) |
Unrealized gain on available-for-sale investment securities |  | (6,235) |  |  | (1,182) |
Core deposit intangible |  | (350) |  |  | (555) |
FHLB stock |  | (191) |  |  | (234) |
Loan origination costs |  | (849) |  |  | (925) |
Bank premises and equipment |  | (405) |  |  | (459) |
Total deferred tax liabilities |  | (10,728) |  |  | (6,408) |
Net deferred tax assets |  | $ | 4,738 |  |  | $ | 8,740 |
The determination of the amount of deferred income tax assets which are more likely than not to be realized is primarily dependent on projections of future earnings, which are subject to uncertainty and estimates that may change given economic conditions and other factors. The realization of deferred income tax assets is assessed and a valuation allowance is recorded if it is more likely than not that all or a portion of the deferred tax asset will not be realized. More likely than not is defined as greater than a 50% chance. All available evidence, both positive and negative is considered to determine whether, based on the weight of the evidence, a valuation allowance is needed. Thus, management concludes no valuation allowance is necessary against deferred tax assets as of December 31, 2020 and 2019. The provision for income taxes differs from amounts computed by applying the statutory Federal income tax rates to operating income before income taxes. The significant items comprising these differences for the years ended December 31, 2020, 2019, and 2018 consisted of the following:
| 2020 |  | 2019 |  | 2018
Federal income tax, at statutory rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
State taxes, net of Federal tax benefit | 7.7 | % |  | 8.3 | % |  | 7.8 | %
Tax exempt investment security income, net | (1.5) | % |  | (0.9) | % |  | (2.7) | %
Bank owned life insurance, net | (1.2) | % |  | (0.4) | % |  | (0.6) | %
Compensation - Stock Compensation | (0.2) | % |  | (0.2) | % |  | (0.6) | %
Change in uncertain tax positions | — | % |  | — | % |  | (0.3) | %
Other | (0.4) | % |  | 0.6 | % |  | (0.9) | %
Effective tax rate | 25.4 | % |  | 28.4 | % |  | 23.7 | %
As of December 31, 2020, the Company had Federal and California net operating loss (“NOL”) carry-forwards of $7,093,000 and $7,692,000, respectively. These NOLs were acquired through business combinations and are subject to IRC 382 will begin expiring at various dates between 2029 and 2035, for federal purposes and various dates between 2029 and 2036 for California purposes. While they are subject to IRC Section 382, management has determined that all of the NOLs are more than likely than not to be utilized before they expire. The Company and its subsidiary file income tax returns in the U.S. federal, California, and Georgia jurisdictions. The Company conducts all of its business activities in the State of California. There are no pending U.S. federal or state income tax examinations by those taxing authorities. The Company is no longer subject to the examination by U.S. federal taxing authorities for the years ended before December 31, 2017 and by the state taxing authorities for the years ended before December 31, 2016. As of December 31, 2020, the Company has no unrecognized tax benefits and does not expect any material changes in the next 12 months. During the years ended December 31, 2020 and 2019, the Company recorded no interest or penalties related to uncertain tax positions.

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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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