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Federal Income Taxes | 12 Months Ended
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Dec. 31, 2022
Federal Income Taxes [Abstract] |
Federal Income Taxes | Note 14. Federal Income Taxes The temporary differences which give rise to significant portions of deferred tax assets and liabilities at December 31 are as follows:
(Dollars in thousands) |  |
Deferred Tax Assets |  | 2022 |  | 2021
Allowance for loan losses |  | $ | 3,021 |  | $ | 3,197
Deferred compensation |  |  | 916 |  |  | 908
Purchase accounting |  |  | 19 |  |  | 18
Other than temporary impairment of investments |  |  | — |  |  | 58
Accumulated other comprehensive loss |  |  | 13,633 |  |  | 145
Lease liabilities |  |  | 1,309 |  |  | 1,030
Other |  |  | 280 |  |  | 354
|  |  | 19,178 |  |  | 5,710
Valuation allowance |  |  | — |  |  | (58)
Total gross deferred tax assets |  |  | 19,178 |  |  | 5,652
Deferred Tax Liabilities |  |  |  |  |  |
Depreciation |  |  | 1,079 |  |  | 102
Right-of-use asset |  |  | 1,281 |  |  | 1,010
Joint ventures and partnerships |  |  | 45 |  |  | 51
Pension |  |  | 711 |  |  | 901
Deferred loan fees and costs, net |  |  | 432 |  |  | 274
Total gross deferred tax liabilities |  |  | 3,548 |  |  | 2,338
Net deferred tax asset |  | $ | 15,630 |  | $ | 3,314
In assessing the realizability of deferred tax assets, Management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, Management believes it is more likely than not that the Bank will realize the benefits of these deferred tax assets other than those for which a valuation allowance has been recorded. The components of the provision for Federal income taxes attributable to income from operations were as follows:
|  | For the Years Ended December 31 |
(Dollars in thousands) |  | 2022 |  | 2021 |
Current tax expense (benefit) |  | $ | 1,385 |  | $ | 3,308 |
Deferred tax (benefit) expense |  |  | 1,172 |  |  | 90 |
Income tax provision |  | $ | 2,557 |  | $ | 3,398 |
For the years ended December 31, 2022 and 2021, the income tax provisions are different from the tax expense which would be computed by applying the Federal statutory rate to pretax operating earnings. The Federal statutory rate was 21% for 2022 and 2021. A reconciliation between the tax provision at the statutory rate and the tax provision at the effective tax rate is as follows:
|  | For the Years Ended December 31 |
(Dollars in thousands) |  | 2022 |  | 2021 |
Tax provision at statutory rate |  | $ | 3,674 |  | $ | 4,833 |
Income on tax-exempt loans and securities |  |  | (1,113) |  |  | (1,190) |
Investment in solar tax credit |  |  | — |  |  | (162) |
Nondeductible interest expense relating to carrying tax-exempt obligations |  |  | 47 |  |  | 26 |
Income from bank owned life insurance |  |  | (86) |  |  | (146) |
Stock option compensation |  |  | 5 |  |  | 5 |
Other, net |  |  | 30 |  |  | 32 |
Income tax provision |  | $ | 2,557 |  | $ | 3,398 |
Effective income tax rate |  |  | 14.6% |  |  | 14.8% |
The Corporation recognizes interest accrued related to unrecognized tax benefits and penalties in income tax expense for all periods presented. No penalties or interest were recognized in 2022 or 2021. The Corporation had no uncertain tax positions at December 31, 2022. The Corporation is no longer subject to U.S. Federal examinations by tax authorities for the years before 2019.

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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 https://asc.fasb.org/extlink&oid=121826272&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 https://asc.fasb.org/extlink&oid=122134291&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 https://asc.fasb.org/extlink&oid=121826272&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 https://asc.fasb.org/extlink&oid=122134291&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 https://asc.fasb.org/extlink&oid=121826272&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 https://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 https://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 https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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