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Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Taxes [Abstract]  
Income Taxes Note 14. 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

2024

2023

Allowance for credit losses

$

3,810

$

3,440

Deferred compensation

951

939

Purchase accounting

20

20

Accumulated other comprehensive loss

9,439

10,882

Lease liabilities

920

1,032

Other

605

596

Total gross deferred tax assets

15,745

16,909

Deferred Tax Liabilities

Depreciation

2,936

3,023

Right-of-use asset

886

1,002

Joint ventures and partnerships

48

43

Pension

663

694

Deferred loan fees and costs, net

381

346

Total gross deferred tax liabilities

4,914

5,108

Net deferred tax asset

$

10,831

$

11,801

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 income taxes attributable to income from operations were as follows:

For the Years Ended December 31

(Dollars in thousands)

2024

2023

Current tax expense (benefit)

$

2,689

$

1,015

Deferred tax expense (benefit)

(473)

1,140

Income tax provision

$

2,216

$

2,155

For the years ended December 31, 2024 and 2023, 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 2024 and 2023. 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)

2024

%

2023

%

Tax provision at statutory rate

$

2,796

21.0%

$

3,310

21.0%

Income on tax-exempt loans and securities

(881)

-6.6%

(949)

-6.0%

Investment in solar tax credit

(29)

-0.2%

(325)

-2.1%

Nondeductible interest expense relating to carrying tax-exempt obligations

323

2.4%

215

1.4%

Income from bank owned life insurance

(107)

-0.8%

(88)

-0.6%

Stock option compensation

12

0.1%

(1)

0.0%

Other, net

102

0.8%

(7)

0.0%

Income tax provision

$

2,216

16.6%

$

2,155

13.7%

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 2024 or 2023. The Corporation had no uncertain tax positions at December 31, 2024. The Corporation is no longer subject to U.S. Federal and state examinations by tax authorities for the years before 2021.