Income Taxes

The Company files income tax returns with the United States of America and the Commonwealth of Virginia. With few exceptions, the Company is no longer subject to federal, state, or local income tax examinations for years prior to 2011.

The net deferred tax asset at December 31, 2014 and 2013 consisted of the following components:



	December 31,
	2014		2013
	(in thousands)
Deferred tax assets:
Allowance for loan losses	$	1,727	$	1,866
Deferred compensation	120		125
Accrued postretirement benefits	47		51
Home equity origination costs	51		41
Other than temporary impairment	—		30
Interest rate swap	98		148
Other real estate owned valuation allowance	—		116
Other	391		381
	$	2,434	$	2,758
Deferred tax liabilities:
Property and equipment	$	405	$	533
Securities available for sale	756		283
	$	1,161	$	816
Net deferred tax asset	$	1,273	$	1,942

The Company has not recorded a valuation allowance for deferred tax assets because management believes that it is more likely than not that they will be ultimately realized.

Income tax expense for the years ended December 31, 2014, 2013 and 2012 consisted of the following components:



	December 31,
	2014		2013		2012
	(in thousands)
Current tax expense	$	1,926	$	1,198	$	2,209
Deferred tax expense (benefit)	142		1,190		350
	$	2,068	$	2,388	$	2,559

The following table reconciles income tax expense to the statutory federal corporate income tax amount, which was calculated by applying the federal corporate income tax rate to pre-tax income for the years ended December 31, 2014, 2013 and 2012.



	December 31,
	2014			2013			2012
	(in thousands)
Statutory federal corporate tax amount	$	3,131		$	3,246		$	3,097
Tax-exempt interest (income)	(454		)	(495		)	(563		)
Officer insurance loss (income)	9			(82		)	7
Net tax credits	(593		)	(312		)	—
Other	(25		)	31			18
	$	2,068		$	2,388		$	2,559

The effective tax rates were 22.46%, 25.02%, and 28.09%, for years ended December 31, 2014, 2013, and 2012, respectively.