11.	INCOME TAXES

The consolidated provisions for income taxes for the years ended December 31, 2015 and 2014 were as follows:

	2015		2014
	(Dollars in Thousands)
Federal
Current	$	10	$	4
Deferred	835			1,213
	845			1,217
State
Current	15			13
Deferred	91			599
	106			612
Total	$	951	$	1,829

The consolidated tax expense (benefit) differed from the amount computed by applying the federal statutory income tax rate of 26.8%, as described in the following table:

	2015			2014
	(Dollars in Thousands)
Income tax expense at federal statutory rate	$	1,206		$	1,828
Increase (decrease) resulting from:
Tax-exempt interest		(240	)		(276	)
Bank-owned life insurance		(108	)		(111	)
State income tax expense, net of federal income taxes	100				279
Other		(7	)		109
Total	$	951		$	1,829

The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities as of December 31, 2015 and 2014 are presented below:

	2015		2014
	(Dollars in Thousands)
Deferred tax assets:
Allowance for loan losses	$	1,395	$	2,276
Deferred compensation		1,617		1,586
Deferred commissions and fees		165		181
Impairment OREO		924		1,199
Federal net operating loss carryforwards		3,591		3,360
State net operating loss carryforwards		231		230
Federal alternative minimum tax and general business credits carryforwards		254		231
Other		467		464
Total gross deferred tax assets		8,644		9,527
Deferred tax liabilities:
Premises and equipment		411		490
Limited partnerships		106		—
Unrealized gain on securities available-for-sale		312		1,098
Other		17		—
Total gross deferred tax liabilities		846		1,588
Net deferred tax asset, included in other assets	$	7,798	$	7,939

As of December 31, 2015 and 2014, the Company had $4.1 million and $3.8 million related to federal and state net operating loss and tax credit carryforwards that can be used to offset income in future periods and reduce income taxes payable in those future periods. The majority of these carryforwards will not begin to expire until 2032. The remaining deferred tax assets, which totaled $3.7 million and $4.1 million as of December 31, 2015 and 2014, respectively, do not have an expiration date.

The Company’s determination of the realization of net deferred tax assets at December 31, 2015 and 2014 was based on management’s assessment of all available positive and negative evidence. As of both December 31, 2015 and December 31, 2014, the Company was not in a three-year cumulative loss position. In addition, the Company has positive evidence supporting the realization of its net deferred tax assets as of December 31, 2015, including the reversal of taxable temporary differences, a strong history of earnings, and tax planning strategies including the conversion of tax-exempt investments to taxable investments to generate future taxable income to prevent tax attributes, including net operating losses, from expiring unutilized. Accordingly, a valuation allowance was not established as of December 31, 2015 or December 31, 2014.

The Company files a consolidated income tax return with the federal government and the State of Alabama. ALC files a Mississippi state income tax return related to operations from its Mississippi branches. The Company is currently open to audit under the statute of limitations by the Internal Revenue Service and the states in which it files for the years ended December 31, 2012 through 2015.

As of December 31, 2015, the Company had no unrecognized tax benefits related to federal or state income tax matters and does not anticipate any material increase or decrease in unrecognized tax benefits relative to any tax positions taken prior to December 31, 2015. As of December 31, 2015, the Company had accrued no interest and no penalties related to uncertain tax positions.