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Income Taxes | 12 Months Ended
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Dec. 31, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | Note 19. Income Taxes The difference between the provision for income taxes and the amounts computed by applying the statutory federal income tax rate of 21% for 2020 and 2019 to income before income taxes is summarized below:
(Dollars in thousands) |  | 2020 |  |  | 2019 |
Income tax at federal statutory rate |  | $ | 4,725 |  |  |  | 21.0 | % |  | $ | 1,171 |  |  |  | 21.0 | %
Increase (decrease) resulting from: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
State income taxes, net of federal tax effect |  |  | 34 |  |  |  | 0.2 | % |  |  | — |  |  |  | (— | %)
Tax-exempt interest income |  |  | (20 | ) |  |  | (0.1 | %) |  |  | (74 | ) |  |  | (1.3 | %)
Income from life insurance |  |  | (82 | ) |  |  | (0.4 | %) |  |  | (196 | ) |  |  | (3.5 | %)
Merger-related expenses |  |  | 174 |  |  |  | 0.8 | % |  |  | 188 |  |  |  | 3.4 | %
Other permanent differences |  |  | (31 | ) |  |  | (0.1 | %) |  |  | (116 | ) |  |  | (2.2 | %)
Provision for income taxes |  | $ | 4,800 |  |  |  | 21.4 | % |  | $ | 973 |  |  |  | 17.4 | %
The significant components of the provision for income taxes for the years ended December 31, 2020 and 2019 were as follows:
(Dollars in thousands) |  | 2020 |  |  | 2019 |
Current tax provision |  |  |  |  |  |  |  |
Federal |  | $ | 6,437 |  |  | $ | 1,058 |
State |  |  | 43 |  |  |  | — |
Total current tax provision |  |  | 6,480 |  |  |  | 1,058 |
Deferred tax benefit |  |  |  |  |  |  |  |
Federal |  |  | (1,680 | ) |  |  | (85 | )
State |  |  | — |  |  |  | — |
Total deferred tax provision |  |  | (1,680 | ) |  |  | (85 | )
Provision for income taxes |  | $ | 4,800 |  |  | $ | 973 |
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of deferred taxes at December 31, 2020 and 2019 were as follows:
(Dollars in thousands) |  | 2020 |  |  | 2019 |
Deferred tax assets relating to: |  |  |  |  |  |  |  |
Allowance for loan losses |  | $ | 2,478 |  |  | $ | 414 |
Compensation differences |  |  | 892 |  |  |  | 19 |
Reserve for loan sale buy backs |  |  | 341 |  |  |  | — |
Acquisition accounting |  |  | 255 |  |  |  | 591 |
Loan origination costs |  |  | 81 |  |  |  | 153 |
Pass-through entities |  |  | 252 |  |  |  | 173 |
Unrealized losses on swaps and securities available for sale |  |  | 108 |  |  |  | — |
Other |  |  | 191 |  |  |  | 341 |
Total deferred tax assets |  |  | 4,598 |  |  |  | 1,691 |
Deferred tax liabilities relating to: |  |  |  |  |  |  |  |
Premises and equipment |  |  | (1,532 | ) |  |  | (1,473 | )
Core deposit and customer based intangible assets |  |  | (464 | ) |  |  | (355 | )
Mortgage servicing rights |  |  | (1,488 | ) |  |  | — |
Unrealized gains on swaps and securities available for sale |  |  | — |  |  |  | (53 | )
Other |  |  | (25 | ) |  |  | (561 | )
Total deferred tax liabilities |  |  | (3,509 | ) |  |  | (2,442 | )
Net deferred tax asset (liability), included in other assets (liabilities) |  | $ | 1,089 |  |  | $ | (751 | )
Deferred income taxes are measured at the enacted tax rate for the period in which they are expected to reverse. State income taxes have been immaterial and ignored for purposes of computing deferred income taxes. Therefore, deferred income taxes as of December 31, 2020 have been measured using the federal income tax rate enacted for subsequent years of 21%. The Company had no net operating losses which can be carried forward and applied against future taxable income. The Company’s policy is to report interest and penalties, if any, related to uncertain tax positions in income tax expense in the consolidated statements of income. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2016. As of December 31, 2020 and 2019, the Company has no uncertain tax positions. The Company’s net deferred tax asset (liability) was $1.1 million and $(0.8) million at December 31, 2020 and 2019, respectively. In evaluating whether the Company will realize the full benefit of its net deferred tax assets, management considers both positive and negative evidence, including among other things recent earnings trends, projected earnings, and asset quality. As of December 31, 2020, management concluded that the Company’s net deferred tax assets were fully realizable. The Company will continue to monitor deferred tax assets to evaluate whether it will be able to realize the full benefit of the net deferred tax asset or whether there is any need for a valuation allowance. Significant negative trends in credit quality, losses from operations, or other factors could impact the realization of the deferred tax asset in the future.

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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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