XML 29 R17.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2017
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The current and deferred components of income tax expense (benefit) were as follows:
For the years ended December 31, | 2017 |  | 2016 |  | 2015
Federal income tax |  |  |  |  |
Current | $ | 4,184,000 |  |  | $ | 6,276,000 |  |  | $ | 4,895,000 |
Deferred | 2,083,000 |  |  | (139,000 | ) |  | 332,000 |
| 6,267,000 |  |  | 6,137,000 |  |  | 5,227,000 |
State franchise tax | 345,000 |  |  | 317,000 |  |  | 287,000 |
| $ | 6,612,000 |  |  | $ | 6,454,000 |  |  | $ | 5,514,000 |
The actual tax expense differs from the expected tax expense (computed by applying the applicable U.S. Federal corporate income tax rate to income before income taxes) as follows:
For the years ended December 31, | 2017 |  | 2016 |  | 2015
Expected tax expense | $ | 9,170,000 |  |  | $ | 8,562,000 |  |  | $ | 7,602,000 |
Non-taxable income | (2,625,000 | ) |  | (2,176,000 | ) |  | (2,086,000 | )
State franchise tax, net of federal tax benefit | 224,000 |  |  | 206,000 |  |  | 187,000 |
Equity compensation | (83,000 | ) |  | — |  |  | — |
Tax credits, net of amortization | (88,000 | ) |  | (105,000 | ) |  | (185,000 | )
Change in federal tax rate | 134,000 |  |  | — |  |  | — |
Other | (120,000 | ) |  | (33,000 | ) |  | (4,000 | )
| $ | 6,612,000 |  |  | $ | 6,454,000 |  |  | $ | 5,514,000 |
Deferred tax assets and liabilities are recognized at the expected future tax rate. On December 22, 2017, the federal tax rate decreased from 35% to 21% effective January 1, 2018. Accordingly, deferred tax assets and liabilities were revalued at December 31, 2017 to reflect the 21% tax rate. Deferred tax assets and liabilities are classified in other assets and other liabilities in the consolidated balance sheets. No valuation allowance is deemed necessary for the deferred tax asset. Items that give rise to the deferred income tax assets and liabilities and the tax effect of each at December 31, 2017 and 2016 are as follows:
| 2017 |  | 2016
Allowance for loan losses | $ | 2,253,000 |  |  | $ | 3,548,000 |
OREO | 11,000 |  |  | 72,000 |
Accrued pension and post-retirement | 1,036,000 |  |  | 1,730,000 |
Goodwill | — |  |  | 2,000 |
Unrealized loss on securities transferred from available for sale to held to maturity | 46,000 |  |  | 70,000 |
Unrealized loss on securities available for sale | 772,000 |  |  | 503,000 |
Restricted stock grants | 173,000 |  |  | 237,000 |
Core deposit intangible | 15,000 |  |  | 20,000 |
Investment in flow through entities | 22,000 |  |  | 29,000 |
Other assets | 28,000 |  |  | 48,000 |
Total deferred tax asset | 4,356,000 |  |  | 6,259,000 |
Net deferred loan costs | (1,313,000 | ) |  | (1,895,000 | )
Depreciation | (1,306,000 | ) |  | (1,808,000 | )
Goodwill | (39,000 | ) |  | — |
Mortgage servicing rights | (266,000 | ) |  | (390,000 | )
Unrealized gain on derivative instruments | (410,000 | ) |  | (626,000 | )
Prepaid expense | (821,000 | ) |  | — |
Total deferred tax liability | (4,155,000 | ) |  | (4,719,000 | )
Net deferred tax asset | $ | 201,000 |  |  | $ | 1,540,000 |
At December 31, 2017 and 2016, the Company held investments in two limited partnerships with related low income housing tax credits. The investments are carried at cost and amortized on the effective yield method as they were entered into prior to 2015. The tax credits from the investments are estimated at $204,000 and $231,000 for the years ended December 31, 2017 and 2016, respectively, and are recorded as a reduction of income tax expense. Amortization of the investment in the limited partnership totaled $178,000 and $194,000 for the years ended December 31, 2017 and 2016, respectively, and is recognized as a component of income tax expense in the consolidated statements of income. The carrying value of these investments was $1,408,000 and $1,503,000 at December 31, 2017 and 2016, respectively, and is recorded in securities available for sale. The Company's total exposure to the limited partnerships was $1,408,000 and $1,503,000 at December 31, 2017 and 2016, respectively, which is comprised of the Company's equity investment in the limited partnerships. FASB ASC Topic 740, "Income Taxes," defines the criteria that an individual tax position must satisfy for some or all of the benefits of that position to be recognized in a company's financial statements. Topic 740 prescribes a recognition threshold of more-likely-than-not, and a measurement attribute for all tax positions taken or expected to be taken on a tax return, in order for those tax positions to be recognized in the financial statements. The Company is currently open to audit under the statute of limitations by the Internal Revenue Service for the years ended December 31, 2014 through 2017.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration