Income Taxes

12 Months Ended

Dec. 31, 2013

Note 15: Income Taxes

The provision for income taxes includes these components:

($ in thousands)	For The Year Ended December
	2013		2012
Taxes currently payable	$	512	$	71
Deferred provision		1,731		1,858

Income tax expense	$	2,243	$	1,929

A reconciliation of income tax expense at the statutory rate to the Company's actual income tax expense is shown below:

	For The Year Ended December
($ in thousands)	2013			2012
Computed at the statutory rate (34%)	$	2,532		$	2,293
Increase (decrease) resulting from
Tax exempt interest		(247	)		(233	)
BOLI Income		(112	)		(120	)
Other		70			(11	)

Actual tax expense	$	2,243		$	1,929

The tax effects of temporary differences related to deferred taxes shown on the balance sheets are:

	At December 31,
($ in thousands)	2013			2012
Deferred tax assets
Allowance for loan losses	$	2,368		$	2,316
OREO Writedowns/Expense		14			83
Accrued compensation and benefits		-			458
Net deferred loan fees		93			94
Mark to market adjustments		-			267
Purchase accounting adjustments		-			3
NOL carry over		535			2,107
AMT credit carry over		798			322
Other		236			261
		4,044			5,911
Deferred tax liabilities
Depreciation		(1,031	)		(1,049	)
Mortgage servicing rights		(1,761	)		(1,284	)
Unrealized gains on available-for-sale securities		(38	)		(943	)
Purchase accounting adjustments		(1,149	)		(1,743	)
Prepaids		(248	)		(249	)
FHLB stock dividends		(466	)		(466	)

		(4,693	)		(5,734	)

Net deferred tax asset/(liability)	$	(649	)	$	177

The Net Operating Loss ("NOL") carry over of $1.6 million begins to expire in 2031.

- 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.

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