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Note 13 - Income Taxes | 12 Months Ended
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Dec. 31, 2016
Notes to Financial Statements |
Income Tax Disclosure [Text Block] | (13) INCOME TAXES The components of income tax expense for the years ended December 31, 2016 and 2015 were as follows:
(In thousands) |  | 2016 |  | 2015
Current |  | $ | 2,303 |  |  | $ | 1,292 |
Deferred |  |  | 220 |  |  |  | 672 |
Totals |  | $ | 2,523 |  |  | $ | 1,964 |
The reconciliation of income tax expense for the years ended December 31, 2016 and 2015, with the amount which would have been provided at the federal statutory rate of 34% follows:
(In thousands) |  | 2016 |  | 2015
Provision at federal statutory tax rate |  | $ | 3,196 |  |  | $ | 2,440 |
State income tax-net of federal tax benefit |  |  | 111 |  |  |  | 107 |
Change in state statutory tax rate |  |  | (4 | ) |  |  | (4 | )
Tax-exempt interest income |  |  | (416 | ) |  |  | (405 | )
Bank-owned life insurance income |  |  | (62 | ) |  |  | (83 | )
Captive insurance net premiums |  |  | (294 | ) |  |  | (322 | )
Nondeductible acquisition expense |  |  | - |  |  |  | 219 |
Other |  |  | (8 | ) |  |  | 12 |
Totals |  | $ | 2,523 |  |  | $ | 1,964 |
Effective tax rate |  |  | 26.8 | % |  |  | 27.4 | %
Significant components of the deferred tax assets and liabilities as of December 31, 2016 and 2015 were as follows:
(In thousands) |  | 2016 |  | 2015
Deferred tax assets (liabilities): |  |  |  |  |  |  |  |
Deferred compensation plans |  | $ | 200 |  |  | $ | 205 |
Allowance for loan losses |  |  | 876 |  |  |  | 872 |
Accrued expenses |  |  | 45 |  |  |  | 155 |
Unrealized loss on securities available for sale |  |  | 1,335 |  |  |  | - |
Other |  |  | 353 |  |  |  | 351 |
Deferred tax assets |  |  | 2,809 |  |  |  | 1,583 |
Depreciation |  |  | (632 | ) |  |  | (550 | )
Deferred loan fees and costs |  |  | (261 | ) |  |  | (186 | )
FHLB stock dividends |  |  | (56 | ) |  |  | (262 | )
Prepaid expenses |  |  | (295 | ) |  |  | (258 | )
Acquisition purchase accounting adjustments |  |  | (304 | ) |  |  | (181 | )
Unrealized gain on securities available for sale |  |  | - |  |  |  | (261 | )
Deferred tax liabilities |  |  | (1,548 | ) |  |  | (1,698 | )
Net deferred tax asset (liability) |  | $ | 1,261 |  |  | $ | (115 | )
Tax laws enacted in 2013 and 2014 decreased the Indiana financial institutions franchise tax rate beginning in 2014 and ending in 2023. Deferred taxes have been adjusted to reflect the newly enacted rates and the period in which temporary differences are expected to reverse. At December 31, 2016 and 2015, the Company had no liability for unrecognized income tax benefits related to uncertain tax positions and does not anticipate any increase in the liability for unrecognized tax benefits during the next twelve months. The Company believes that its income tax positions would be sustained upon examination and does not anticipate any adjustments that would result in a material change to its financial position or results of operations. The Company files consolidated U.S. federal income tax returns and Indiana state income tax returns. Returns filed in these jurisdictions for tax years ended on or after December 31, 2013 are subject to examination by the relevant taxing authorities. Each entity included in the consolidated federal and Indiana state income tax returns filed by the Company are charged or given credit for the applicable tax as though separate returns were filed. Retained earnings of the Bank at December 31, 2015 and 2014 include approximately $ 1.0 million for which no deferred federal income tax liability has been recognized. This amount represents an allocation of income to bad debt deductions as of December 31, 1987 for tax purposes only. Reduction of such allocated amounts for purposes other than tax bad debt losses, including redemption of bank stock, excess dividends or loss of “bank” status, would create income for tax purposes only, subject to the then-current corporate income tax rate. The unrecorded deferred liability on these amounts was approximately $ 354,000 at December 31, 2015 and 2014.

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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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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