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INCOME TAXES | 12 Months Ended
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Sep. 30, 2023
Income Taxes [Abstract] |
INCOME TAXES | NOTE K - INCOME TAXES The Company’s income tax expense is comprised of the following components for the years ended September 30, 2023 and 2022:
|  | September 30, |
|  | 2023 |  |  | 2022 |
|  | (In thousands) |
Current |  | $ | 3,647 |  |  | $ | 3,163 |
Deferred |  |  | (615 | ) |  |  | 87 |
Total income tax expense |  | $ | 3,032 |  |  | $ | 3,250 |
A reconciliation of income tax at the statutory tax rate to the effective income tax expense for the years ended September 30, 2023 and 2022 is as follows:
|  | September 30, |
|  | 2023 |  |  | 2022 |
|  | (In thousands) |
Income tax expense at statutory rate |  | $ | 2,256 |  |  | $ | 2,339 |
Increase (decrease) resulting from: |  |  |  |  |  |  |  |
State income taxes, net of federal income tax benefit |  |  | 931 |  |  |  | 922 |
Tax-exempt income, net |  |  | (90 | ) |  |  | (87 | )
Nondeductible expenses |  |  | 58 |  |  |  | 37 |
Share based compensation |  |  | 54 |  |  |  | — |
Employee stock ownership plan |  |  | 11 |  |  |  | 3 |
Other, net |  |  | (188 | ) |  |  | 36 |
Total income tax expense |  | $ | 3,032 |  |  | $ | 3,250 |
The major sources of temporary differences and their deferred tax effect at September 30, 2023 and 2022 are as follows:
|  | September 30, |
|  | 2023 |  |  | 2022 |
|  | (In thousands) |
Allowance for loan losses |  | $ | 2,342 |  |  | $ | 2,369 |
Net unrealized loss, investment securities available-for-sale |  |  | 483 |  |  |  | 472 |
Deferred loan fees |  |  | 287 |  |  |  | 244 |
Unrealized loss, minimum pension liability |  |  | 132 |  |  |  | 288 |
Employee benefits |  |  | 265 |  |  |  | — |
Allowance for transaction expense |  |  | 11 |  |  |  | — |
Straight line rent |  |  | 72 |  |  |  | 88 |
Gross deferred tax asset |  |  | 3,592 |  |  |  | 3,461 |
Depreciation |  |  | (588 | ) |  |  | (816 | )
Employee benefits |  |  | — |  |  |  | (122 | )
Mortgage servicing rights |  |  | (8 | ) |  |  | — |
Gross deferred tax liability |  |  | (596 | ) |  |  | (938 | )
Net deferred tax asset, included in other assets |  | $ | 2,996 |  |  | $ | 2,523 |
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. 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. There were no valuation allowances for the year ended September 30, 2023 and 2022. The Company has considered future market growth, forecasted earnings, future taxable income, feasible and permissible tax planning strategies in determining the realizability of deferred tax assets. 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 Bank’s statutory income tax rate in the State of New Jersey was 9.0% for the years ending September 30, 2023 and 2022. The State of New Jersey has imposed a temporary surtax on corporations earning New Jersey allocated income in excess of $1 million. The surtax is set at a rate of 2.5% and it currently effective through December 31, 2023. Accordingly, the Company used an 11.5% State tax rate for the calculation of its State income tax expense the years ended September 30, 2023 and 2022.

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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 -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
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