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Income Taxes
 12 Months Ended
Dec. 31, 2011
Income Taxes [Abstract]  
Income Taxes

Note 11 - Income taxes

The Company files income tax returns in the U.S. federal jurisdiction and the state of Virginia. With few exceptions, the Company is no longer subject to U.S. federal, state and local income tax examinations by tax authorities for years prior to 2008.

Income tax expense attributable to income before income tax expense is summarized as follows:

             
    December 31,  
    2011     2010  
Current federal income tax expense $ (98 ) $ 837  
Deferred federal income tax expense (benefit)   195     (79 )
Tax credits   (190 )   (144 )
Income tax expense (benefit) $ (93 ) $ 614  

 

Income tax expense differed from amounts computed by applying the U.S. Federal income tax rate of 34% to income before income tax expense as a result of the following:

             
    2011     2010  
Computed "expected" income tax provision $ 172   $ 828  
Increase (reduction) in income tax resulting from:            
Non-taxable income   (86 )   (83 )
Non-deductible expenses   11     13  
Tax credits   (190 )   (144 )
Income tax expense (benefit) $ (93 ) $ 614  

 

The tax effects of temporary differences result in deferred tax assets and liabilities as presented below:

         
    2011   2010
Deferred tax assets        
Allowance for loan losses $ 1,223 $ 1,434
Unrealized loss on available-for-sale securities   28   357
Carryover of tax credits   325   311
Gross deferred tax assets   1,576   2,102
 
Deferred tax liabilities        
Depreciation   169   187
Other   16   -
Prepaid expenses   16   16
Gross deferred tax liabilities   201   203
Net deferred tax asset $ 1,375 $ 1,899