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Income Taxes | 12 Months Ended
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Dec. 31, 2022
Income Taxes [Abstract] |
Income Taxes | Note 16 - Income Taxes The components of income tax expense are summarized as follows:
|  | Years Ended December 31,
|  | 2022 |  |  | 2021
|  | (In Thousands)
Current income tax expense: |  |  |  |  |
Federal | $ | 12,323 |  | $ | 8,736
State |  | 6,215 |  |  | 6,257
|  | 18,538 |  |  | 14,993
Deferred income tax benefit: |  |  |  |  |
Federal |  | (967) |  |  | (571)
State |  | (40) |  |  | (404)
|  | (1,007) |  |  | (975)
Total Income Tax Expense | $ | 17,531 |  | $ | 14,018
Note 16 - Income Taxes (continued) The tax effects of existing temporary differences that give rise to significant portions of the deferred income tax assets and deferred income tax liabilities are as follows:
|  | December 31,
|  | 2022 |  |  | 2021
Deferred income tax assets: |  | (In Thousands)
Allowance for loan losses | $ | 9,253 |  | $ | 10,610
Other real estate owned expenses |  | 2 |  |  | 11
Non-accrual interest |  | 279 |  |  | 361
Benefit plan-accumulated other comprehensive loss |  | 159 |  |  | 234
Purchase accounting adjustment on loans receivable acquired |  | 752 |  |  | 1,277
Net operating loss carry forwards |  | 1,263 |  |  | 1,359
Lease liability |  | 3,961 |  |  | 3,645
Unrealized loss on securities |  | 2,974 |  |  | -
Other |  | 2,783 |  |  | 1,509
|  | 21,426 |  |  | 19,006
Deferred income tax liabilities: |  |  |  |  |
Purchase accounting adjustment on premises and equipment acquired |  | 74 |  |  | 77
Right-of-use assets |  | 3,865 |  |  | 3,561
Unrealized gain on securities |  | - |  |  | 1,028
SBA servicing asset |  | 368 |  |  | 520
Borrowing modification |  | 440 |  |  | 597
Benefit plans |  | 217 |  |  | 264
|  | 4,964 |  |  | 6,047
Net Deferred Tax Asset | $ | 16,462 |  | $ | 12,959
A summary of the change in the net deferred tax asset is as follows:
|  | Years Ended December 31,
|  | 2022 |  |  | 2021
| (In Thousands)
Balance at beginning of year: | $ | 12,959 |  | $ | 12,574
Deferred tax benefit |  | 1,007 |  |  | 975
Other comprehensive income |  |  |  |  |
Available for sale securities |  | 2,560 |  |  | 60
Benefit plan |  | (64) |  |  | (650)
Balance at end of year | $ | 16,462 |  | $ | 12,959
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. In making this assessment, management has considered the profitability of current core operations, future market growth, forecasted earnings, future taxable income, and ongoing, feasible and permissible tax planning strategies. If the Company was to determine that it would not be able to realize a portion of its net deferred tax asset in the future for which there is currently no valuation allowance, an adjustment to the net deferred tax asset would be charged to earnings in the period such determination was made. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences are deductible and carry forwards are available. The Company believes it will generate sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets in our consolidated balance sheet. In conjunction with the Company’s acquisition of IA Bancorp in 2018, the Company acquired a federal net operating loss carry forward of $8.7 million. This carry forward is available for use through 2035; however, in accordance with Internal Revenue Code Section 382, usage of the carry forward is limited to $459,000 annually on a cumulative basis (portions of the $459,000 not used in a particular year may be added to subsequent usage). At December 31, 2022 and 2021, the Company had approximately $6.0 million and $6.5 million remaining of this federal net operating loss carry forward available to offset future taxable income for federal tax reporting purposes. Note 16 - Income Taxes (continued) The following table presents a reconciliation between the reported income tax expense and the income tax expense which would be computed by applying the normal federal income tax rate of 21.0 percent to income before income tax expense.
|  | Years Ended December 31,
|  | 2022 |  |  |  | 2021 |
|  | (In Thousands)
Federal income tax expense at statutory rate | $ | 13,253 |  |  | $ | 10,134 |
Increases in income taxes resulting from: |  |  |  |  |  |  |
State income tax , net of federal income tax effect |  | 4,878 |  |  |  | 4,684 |
Tax-exempt income |  | (63) |  |  |  | (45) |
Bank-owned life insurance earnings |  | (561) |  |  |  | (620) |
Other items, net |  | 24 |  |  |  | (135) |
Effective Income Tax Expense | $ | 17,531 |  |  | $ | 14,018 |
Effective Income Tax Rate |  | 27.8 | % |  |  | 29.0 | %

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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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