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Income Taxes | 12 Months Ended
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Dec. 31, 2019
Income Tax Disclosure [Abstract] |
Income Taxes |
1 2. | INCOME TAXES
The consolidated provisions for income taxes for the years ended December 31, 2019 and 2018 were as follows:
|  | 2019 |  |  | 2018 |
|  | (Dollars in Thousands) |
Federal |  |  |  |  |  |  |  |
Current |  | $ | (54 | ) |  | $ | (157 | )
Deferred |  |  | 1,100 |  |  |  | 859 |
Total federal |  |  | 1,046 |  |  |  | 702 |
State |  |  |  |  |  |  |  |
Current |  |  | 166 |  |  |  | 59 |
Deferred |  |  | 34 |  |  |  | 140 |
Total state |  |  | 200 |  |  |  | 199 |
Total |  | $ | 1,246 |  |  | $ | 901 |
The consolidated tax expense differed from the amount computed by applying the Company’s federal statutory income tax rate of 21.0% in 2019 and 2018 as described in the following table:
|  | 2019 |  |  | 2018 |
|  | (Dollars in Thousands) |
Income tax expense at federal statutory rate |  | $ | 1,220 |  |  | $ | 712 |
Increase (decrease) resulting from: |  |  |  |  |  |  |  |
Tax-exempt interest |  |  | (95 | ) |  |  | (119 | )
Bank-owned life insurance |  |  | (65 | ) |  |  | (66 | )
State income tax expense, net of federal income taxes |  |  | 229 |  |  |  | 137 |
Other |  |  | (43 | ) |  |  | 237 |
Total |  | $ | 1,246 |  |  | $ | 901 |
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, 2019 and 2018 are presented below:
|  | 2019 |  |  | 2018 |
|  | (Dollars in Thousands) |
Deferred tax assets: |  |  |  |  |  |  |  |
Allowance for loan losses |  | $ | 1,354 |  |  | $ | 1,228 |
Deferred compensation |  |  | 1,040 |  |  |  | 1,064 |
Deferred commissions and fees |  |  | 337 |  |  |  | 308 |
Impairment of other real estate owned |  |  | 52 |  |  |  | 99 |
Federal net operating loss carryforwards |  |  | 655 |  |  |  | 1,549 |
State net operating loss carryforwards |  |  | 270 |  |  |  | 280 |
Federal alternative minimum tax and general business credits carryforwards |  |  | 107 |  |  |  | 167 |
Unrealized loss on securities available-for-sale |  |  | 71 |  |  |  | 797 |
Unrealized loss on cash flow hedges |  |  | 1 |  |  |  | — |
Other |  |  | 630 |  |  |  | 621 |
Total gross deferred tax assets |  |  | 4,517 |  |  |  | 6,113 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Premises and equipment |  |  | 1,205 |  |  |  | 888 |
Core deposit intangible |  |  | 347 |  |  |  | 463 |
Limited partnerships |  |  | 135 |  |  |  | 122 |
Other |  |  | 79 |  |  |  | 31 |
Total gross deferred tax liabilities |  |  | 1,766 |  |  |  | 1,504 |
Net deferred tax asset, included in other assets |  | $ | 2,751 |  |  | $ | 4,609 |
As of December 31, 2019 and 2018, respectively, the Company had federal net operating loss carryforwards of $3.1 million and $7.4 million, and the Company had state net operating loss carryforwards of $5.9 million and $8.4 million for the same respective periods. In addition, as of December 31, 2019 and 2018, the Company had federal tax credit carryforwards of $0.1 million and $0.2 million, respectively. The federal and state net operating loss and federal tax credit carryforwards 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 Company files a consolidated income tax return with the federal government and the States of Alabama and Tennessee. ALC files several state income tax returns, with the majority of its non-Alabama income being apportioned to Mississippi. The Company is currently open to audit under the statute of limitations by the Internal Revenue Service and the states in which it filed for the years ended December 31, 2014 through 2019. As of December 31, 2019, 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, 2019. As of December 31, 2019, the Company had accrued no interest and no penalties related to uncertain tax positions.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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