XML 123 R20.htm IDEA: XBRL DOCUMENT

Note 12 - Income Taxes

12 Months Ended

Dec. 31, 2014

12.

INCOME TAXES

The provision for federal income taxes consists of:

(Dollar amounts in thousands)	2014			2013		2012

Current payable	$	2,146		$	1,556	$	1,660
Deferred		(154	)		423		2

Total provision	$	1,992		$	1,979	$	1,662

The tax effects of deductible and taxable temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows:

(Dollar amounts in thousands)	2014		2013

Deferred tax assets:
Allowance for loan and lease losses	$	2,328	$	2,396
Net unrealized loss on securities		-		1,152
Supplemental retirement plan		282		247
Investment security basis adjustment		66		66
Nonaccrual interest income		444		472
Deferred origination fees, net		295		171
OREO adjustments		94		107
Accrued compensation		207		197
Other		14		19
Gross deferred tax assets		3,730		4,827

Deferred tax liabilities:
Premises and equipment		385		503
Net unrealized gain on securities		1,311		-
FHLB stock dividends		225		225
Intangibles		353		304
Other		77		107
Gross deferred tax liabilities		2,351		1,139

Net deferred tax assets	$	1,379	$	3,688

No valuation allowance was established at December 31, 2014 and 2013, in view of the Company’s ability to carry-back to taxes paid in previous years and certain tax strategies, coupled with the anticipated future taxable income as evidenced by the Company's earnings potential.

The reconciliation between the federal statutory rate and the Company’s effective consolidated income tax rate is as follows:

(Dollar amounts in thousands)	2014						2013						2012
				% of						% of						% of
				Pretax						Pretax						Pretax
	Amount			Income			Amount			Income			Amount			Income

Provision at statutory rate	$	3,119			34.0	% $		3,062			34.0	% $		2,700			34.0	%
Tax-free income		(1,187	)		(12.9	)		(1,138	)		(12.6	)		(1,095	)		(13.8	)
Nondeductible interest expense		37			0.4			45			0.5			48			0.6
Other		23			0.2			10			0.1			9			0.1

Actual tax expense and effective rate	$	1,992			21.7	% $		1,979			22.0	% $		1,662			20.9	%

ASC 740‐10 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Benefits from tax positions should be recognized in the financial statements only when it is more likely than not that the tax position will be sustained upon examination by the appropriate taxing authority that would have full knowledge of all relevant information. A tax position that meets the more‐likely‐than‐not recognition threshold is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more‐likely‐than‐not recognition threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more‐likely‐than‐not recognition threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

At December 31, 2014 and December 31, 2013, the Company had no unrecognized tax benefits. The Company does not expect the total amount of unrecognized tax benefits to significantly increase within the next 12 months. The Company recognizes interest and penalties on unrecognized tax benefits as a component of income tax expense.

The Company and the Bank are subject to U.S. federal income tax as well as an income tax in the state of Ohio, and the Bank is subject to a capital‐based franchise tax in the state of Ohio. The Company and the Bank are no longer subject to examination by taxing authorities for years before December 31, 2011.

- 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