XML 117 R25.htm IDEA: XBRL DOCUMENT
v3.19.3.a.u2

INCOME TAXES | 12 Months Ended
--- | ---
Dec. 31, 2019
INCOME TAXES |
INCOME TAXES | 17. INCOME TAXES The Tax Cuts and Jobs Act, enacted on December 22, 2017 lowered the federal corporate income tax rate from 35% to 21% effective January 1, 2018. The expense for income taxes is summarized below and includes both federal and applicable state corporate income taxes:
|  | YEAR ENDED DECEMBER 31,
|  | 2019 |  | 2018 |  | 2017
|  | (IN THOUSANDS)
Current |  | $ | 1,393 |  | $ | (988) |  | $ | 1,084
Deferred |  |  | 179 |  |  | 2,665 |  |  | 1,679
Change in corporate tax rate |  |  | — |  |  | — |  |  | 2,624
Income tax expense |  | $ | 1,572 |  | $ | 1,677 |  | $ | 5,387
The reconciliation between the federal statutory tax rate and the Company’s effective consolidated income tax rate is as follows:
|  | YEAR ENDED DECEMBER 31, |
|  | 2019 |  | 2018 |  | 2017 |
|  | AMOUNT |  | RATE |  | AMOUNT |  | RATE |  | AMOUNT |  | RATE |
|  | (IN THOUSANDS, EXCEPT PERCENTAGES) |
Income tax expense based on federal statutory rate |  | $ | 1,596 |  | 21.0 | % | $ | 1,983 |  | 21.0 | % | $ | 2,951 |  | 34.0 | %
Tax exempt income |  |  | (131) |  | (1.4) |  |  | (131) |  | (1.4) |  |  | (283) |  | (3.3) |
Other |  |  | 107 |  | 1.1 |  |  | (175) |  | (1.8) |  |  | 95 |  | 1.0 |
Change in corporate tax rate |  |  | — |  | — |  |  | — |  | — |  |  | 2,624 |  | 30.4 |
Total expense for income taxes |  | $ | 1,572 |  | 20.7 | % | $ | 1,677 |  | 17.8 | % | $ | 5,387 |  | 62.1 | %
The following table highlights the major components comprising the deferred tax assets and liabilities for each of the periods presented:
|  | AT DECEMBER 31,
|  | 2019 |  | 2018
|  | (IN THOUSANDS)
DEFERRED TAX ASSETS: |  |  |  |  |  |
Allowance for loan losses |  | $ | 1,949 |  | $ | 1,821
Unfunded commitment reserve |  |  | 215 |  |  | 187
Unrealized investment security losses |  |  | — |  |  | 374
Premises and equipment |  |  | 1,129 |  |  | 1,056
Accrued pension obligation |  |  | 1,093 |  |  | 144
Other |  |  | 230 |  |  | 255
Total tax assets |  |  | 4,616 |  |  | 3,837
DEFERRED TAX LIABILITIES: |  |  |  |  |  |
Investment accretion |  |  | (82) |  |  | (90)
Unrealized investment security gains |  |  | (456) |  |  | —
Other |  |  | (102) |  |  | (110)
Total tax liabilities |  |  | (640) |  |  | (200)
Net deferred tax asset |  | $ | 3,976 |  | $ | 3,637
At December 31, 2019 and 2018, the Company had no valuation allowance established against its deferred tax assets as we believe the Company will generate sufficient future taxable income to fully utilize these assets. As a result of the Tax Cuts and Jobs Act, the Company’s AMT tax credits that are not used to reduce regular taxes are eligible for a 50% refund in 2018 to 2020 and a 100% refund in 2021. Due to this change, the AMT tax credit has been fully utilized as of December 31, 2019. As of December 31, 2018, the AMT tax credit was reclassified to other assets and amounted to approximately $287,000. The change in net deferred tax assets and liabilities consist of the following:
|  | YEAR ENDED
|  | DECEMBER 31,
|  | 2019 |  | 2018
|  | (IN THOUSANDS)
Unrealized (gains) losses recognized in comprehensive income |  | $ | (830) |  | $ | 288
Pension obligation of the defined benefit plan not yet recognized in income |  |  | 1,348 |  |  | 51
Deferred provision for income taxes |  |  | (179) |  |  | (2,665)
Net increase (decrease) |  | $ | 339 |  | $ | (2,326)
The Company utilizes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Benefits from tax positions should be recognized in the financial statements only when it is more likely than not that the tax position will be sustained upon examination by the appropriate taxing authority that would have full knowledge of all relevant information. A tax position that meets the more-likely-than-not recognition threshold is measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not recognition threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met. The Company has no tax liability for uncertain tax positions. The Company’s federal and state income tax returns for taxable years through 2016 have been closed for purposes of examination by the Internal Revenue Service and the Pennsylvania Department of Revenue.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration