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Income Taxes
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Income Taxes
10.
INCOME TAXES

The consolidated provisions for income taxes for the years ended December 31, 2023 and 2022 were as follows:

 

 

 

2023

 

 

2022

 

 

 

(Dollars in Thousands)

 

Federal

 

 

 

 

 

 

Current

 

$

2,121

 

 

$

2,025

 

Deferred

 

 

70

 

 

 

(291

)

Total federal

 

 

2,191

 

 

 

1,734

 

State

 

 

 

 

 

 

Current

 

 

532

 

 

 

490

 

Deferred

 

 

63

 

 

 

(76

)

Total state

 

 

595

 

 

 

414

 

Total

 

$

2,786

 

 

$

2,148

 

 

The consolidated tax expense differed from the amount computed by applying the Company’s federal statutory income tax rate of 21.0% in 2023 and 2022 as described in the following table:

 

 

 

2023

 

 

2022

 

 

 

(Dollars in Thousands)

 

Income tax expense at federal statutory rate

 

$

2,368

 

 

$

1,892

 

Increase (decrease) resulting from:

 

 

 

 

 

 

Tax-exempt interest

 

 

(55

)

 

 

(76

)

Bank-owned life insurance

 

 

(64

)

 

 

(62

)

State income tax expense, net of federal income taxes

 

 

406

 

 

 

329

 

Apportionment and state rate changes

 

 

13

 

 

 

(6

)

Other

 

 

118

 

 

 

71

 

Total

 

$

2,786

 

 

$

2,148

 

 

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, 2023 and 2022 are presented below:

 

 

 

2023

 

 

2022

 

 

 

(Dollars in Thousands)

 

Deferred tax assets:

 

 

 

 

 

 

Allowance for credit losses

 

$

2,719

 

 

$

2,333

 

Deferred compensation

 

 

817

 

 

 

895

 

Deferred commissions and fees

 

 

372

 

 

 

407

 

Unrealized loss on securities available-for-sale

 

 

2,332

 

 

 

2,715

 

Other

 

 

1,000

 

 

 

905

 

Total gross deferred tax assets

 

 

7,240

 

 

 

7,255

 

Deferred tax liabilities:

 

 

 

 

 

 

Premises and equipment

 

 

1,284

 

 

 

1,288

 

Core deposit intangible

 

 

42

 

 

 

91

 

Limited partnerships

 

 

96

 

 

 

94

 

Unrealized gain on cash flow hedges

 

 

188

 

 

 

301

 

Other

 

 

288

 

 

 

341

 

Total gross deferred tax liabilities

 

 

1,898

 

 

 

2,115

 

Net deferred tax asset, included in other assets

 

$

5,342

 

 

$

5,140

 

 

The Company did not have any federal or state net operating loss carryforwards as of December 31, 2023 or December 31, 2022. The Company files income tax returns with the federal government and several states. The majority of its income is attributable to the states of Alabama and Tennessee. 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, 2020 through 2023.

As of December 31, 2023, 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, 2023. As of December 31, 2023, the Company had accrued no interest and no penalties related to uncertain tax positions.