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Income Taxes | 12 Months Ended
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Dec. 31, 2021
Income Taxes |
Income Taxes | 9. Income Taxes The components of the provision for income taxes are as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Years Ended December 31, |
​ |  | 2021 |  | 2020 |
Current expense: | ​ | ​ | ​ | ​ | ​ | ​ | ​
Federal | ​ | $ | 2,042 | ​ | $ | 3,078 | ​
State | ​ |  | 284 | ​ |  | 12 | ​
Total current expense | ​ |  | 2,326 | ​ |  | 3,090 | ​
Deferred expense (benefit): | ​ |  |  | ​ |  |  | ​
Federal | ​ |  | 1,107 | ​ |  | (1,531) | ​
State | ​ | ​ | 1,306 | ​ | ​ | (558) | ​
Change in valuation allowance | ​ | ​ | (1,306) | ​ | ​ | 558 | ​
Total deferred expense (benefit) | ​ | ​ | 1,107 | ​ | ​ | (1,531) | ​
Total provision for income taxes | ​ | $ | 3,433 | ​ | $ | 1,559 | ​
​ The following is a reconciliation between the expected federal statutory income tax rate of 21% (2021 and 2020) and the Company’s actual income tax expense and rate: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Years ended December 31, | ​
​ |  | 2021 |  | 2020 | ​
Provision at statutory rate | ​ | $ | 3,148 | ​ | 21.00 | % | $ | 1,570 | ​ | 21.00 | %
Tax exempt income | ​ |  | (125) |  | (0.83) | % |  | (79) |  | (1.06) | %
State income taxes, net of federal income tax benefit | ​ |  | 192 |  | 1.28 | % |  | 12 |  | 0.16 | %
Other, net | ​ |  | 218 |  | 1.45 | % |  | 56 |  | 0.75 | %
Effective income tax and rate | ​ | $ | 3,433 |  | 22.90 | % | $ | 1,559 |  | 20.85 | %
​ Provision for income taxes directly reflects the expected tax associated with the pre-tax income generated for the given year and certain regulatory requirements. The effective tax rate was 22.90% and 20.85% for the years ended December 31, 2021 and 2020, respectively. The statutory tax rate is impacted by the benefits derived from tax-exempt bond income and income received on the bank owned life insurance to arrive at the effective tax rate. ​ ​ The tax effects of temporary differences that give rise to significant components of the deferred tax assets and deferred tax liabilities at December 31, 2021 and 2020 are presented below: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31,
​ |  | 2021 |  | 2020
Deferred tax assets: | ​ | ​ | ​ | ​ | ​ |
Allowance for loan losses | ​ | $ | 2,041 | ​ | $ | 3,141
Deferred expenses | ​ |  | 39 | ​ |  | 47
Deferred compensation | ​ | ​ | 1,538 | ​ | ​ | 1,271
Unrecognized pension liability | ​ |  | 1,037 | ​ |  | 1,272
Postretirement liability | ​ |  | 920 | ​ |  | 954
Deferred loss on OREO | ​ |  | — | ​ |  | 83
Deferred loan fees | ​ | ​ | — | ​ | ​ | 158
Unrealized loss on securities | ​ |  | 727 | ​ |  | —
State tax NOLs | ​ |  | — | ​ |  | 990
Other | ​ |  | 431 | ​ |  | 324
Gross deferred tax assets | ​ |  | 6,733 | ​ |  | 8,240
Deferred tax liabilities: | ​ |  |  | ​ |  |
Prepaid expenses | ​ |  | (262) | ​ |  | (217)
Prepaid pension | ​ |  | (1,275) | ​ |  | (1,276)
Deferred loan fees | ​ |  | (154) | ​ |  | —
Depreciation and amortization | ​ |  | (525) | ​ |  | (375)
Unrealized gain on securities | ​ | ​ | — | ​ | ​ | (264)
Mortgage servicing rights | ​ |  | (711) | ​ |  | (645)
Gross deferred tax liabilities | ​ |  | (2,927) | ​ |  | (2,777)
Net deferred tax asset | ​ |  | 3,806 | ​ |  | 5,463
Deferred tax valuation allowance | ​ |  | (454) | ​ |  | (1,760)
Deferred tax assets, net of allowance | ​ | $ | 3,352 | ​ | $ | 3,703
​ Income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the relative federal or state tax law to the taxable income determined. The Company determines deferred income taxes using the liability (or balance sheet method). Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases at the currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled. Deferred income tax expense or benefit results from changes in deferred tax assets (“DTAs”) and liabilities between periods. DTAs are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized. ​ New York State (“NYS”) tax law provides for a permanent deduction of income from “qualified” loans for community banks. Accordingly, the Company has generally incurred NYS taxable losses and incurred minimal NYS income tax liability. As the Company has not established a history of strong NYS taxable income, the Company has established a full valuation allowance against the NYS deferred tax asset. ​ Retained earnings at December 31, 2021 and 2020 include a contingency reserve for loan losses of $1,534, which represents the tax reserve balance existing at December 31, 1987 and is maintained in accordance with provisions of the Internal Revenue Code applicable to mutual savings banks. Amounts transferred to the reserve have been claimed as deductions from taxable income and, if the reserve is used for purposes other than to absorb losses on loans, a federal income tax liability could be incurred. It is not anticipated that the Company will incur a federal income tax liability relating to this reserve balance and accordingly, deferred income taxes of $414 at December 31, 2021 and $414 at December 31, 2020 have not been recognized. ​ The Company’s income tax returns are subject to review and examination by federal and state taxing authorities. The Company is currently open to audit under the applicable statutes of limitations by the Internal Revenue Service for the years ended December 31, 2018 through 2021. The years open to examination by state taxing authorities vary by jurisdiction; no years prior to 2018 are open.

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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 http://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 http://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 http://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 http://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 http://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 http://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 http://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 http://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 http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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