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Income Taxes | 12 Months Ended
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Dec. 31, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | (8) Income Taxes The components of income tax expense for the years ended December 31, 2021 and 2020 are as follows: (in thousands)
|  | Year Ended December 31, 2021 |  |  | Year Ended December 31, 2020 |
Current |  | $ | 2,565 |  |  | $ | 865 |
Deferred |  |  | (227 | ) |  |  | (73 | )
|  | $ | 2,338 |  |  | $ | 792 |
The difference between income tax expense and the amount computed by applying the statutory federal income tax rate to income before taxes for the years ended December 31, 2021 and 2020 is as follows (in thousands):
|  | Year Ended December 31, 2021 |  |  | Year Ended December 31, 2020 |
Statutory Federal tax rate |  |  | 21 | % |  |  | 21 | %
Pretax income at statutory rate |  | $ | 2,082 |  |  | $ | 815 |
State income tax, net of federal benefit |  |  | 265 |  |  |  | (95 | )
Cash surrender value of life insurance |  |  | (117 | ) |  |  | (83 | )
Permanent adjustments |  |  | 41 |  |  |  | 26 |
Other |  |  | 67 |  |  |  | 129 |
Actual tax expense 24% and 20%, respectively |  | $ | 2,338 |  |  | $ | 792 |
The following summarizes the sources and expected tax consequences of future deductions or income for income tax purposes which comprised the net deferred taxes at December 31, 2021 and 2020: (in thousands)
|  | Year Ended December 31, 2021 |  |  | Year Ended December 31, 2020 |
Deferred income tax assets: |  |  |  |  |  |
Allowance for loan losses |  | $ | 2,195 |  |  | $ | 1,625 |
Deferred compensation |  | 775 |  |  | 873 |
Net operating losses |  |  | 1,849 |  |  |  | 1,683 |
Unrealized loss on investment securities available-for-sale |  |  | 122 |  |  |  | — |
State tax credits |  |  | — |  |  | 358 |
Fair value adjustments |  |  | 522 |  |  |  | 673 |
Other |  | 182 |  |  | 199 |
Total deferred income tax assets |  |  | 5,645 |  |  |  | 5,411 |
Deferred income tax liabilities: |  |  |  |  |  |
Core deposit intangible |  |  | 391 |  |  |  | 440 |
Premises and equipment |  | 498 |  |  | 533 |
Unrealized gain on investment securities available-for-sale |  |  | — |  |  | 52 |
Other |  | 123 |  |  | 154 |
Total deferred income tax liabilities |  |  | 1,012 |  |  |  | 1,179 |
Net deferred income tax asset |  | $ | 4,633 |  |  | $ | 4,232 |
The Company establishes a valuation allowance if, based on the weight of the available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. As of December 31, 2021 and 2020, the Company believes that it will have sufficient earnings to realize its deferred tax asset and has not provided an allowance. The Company is subject to federal income tax and income tax of state taxing authorities. The Company's federal and state income tax returns for the years ended December 31, 2020, 2019 and 2018 are open to audit under the statutes of limitations. Prior to January 1, 1996, the Bank was permitted under the Internal Revenue Code (the “Code”) a special bad debt deduction related to additions to tax bad debt reserves established for the purpose of absorbing losses. The provisions of the Code permitted the Bank to deduct from taxable income an allowance for bad debts based on the greater of a percentage of taxable income before such deduction or actual loss experience. Retained earnings at December 31, 2021 includes approximately $3,625,000 for which no deferred Federal income tax liability has been recognized. The amounts represent an allocation of income for bad debt deductions for tax purposes only. Reduction of amounts so allocated for purposes other than tax bad debt losses would create income for tax purposes only, which would be subject to the then current corporate income tax rate. On August 20, 1996, legislation was passed which eliminated the percentage of taxable income bad debt deduction for thrift institutions for tax years beginning after December 31, 1995. This legislation also requires a thrift to generally recapture the excess of its current tax reserves over its 1987 base year reserves whereas the base year reserves are frozen from taxation. No additional financial statement tax expense resulted from this legislation as the Bank had previously provided deferred taxes on this recaptured amount.

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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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