Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Taxes [Abstract]

Income Tax Expense

Income tax expense was as follows:

	2023		2022
	(In thousands)
Current
Federal	$	300	$	700
State		398		218
Deferred
Federal		1,046		944
State		241		551
Total	$	1,985	$	2,413

Effective Income Tax Rate Reconciliation

Effective tax rates differ from the federal statutory rate of 21% applied to income before income taxes due to the following:

	2023			2022
	(In thousands)
Federal statutory rate times pre-tax net income	$	1,370		$	1,705
Effect of:
State taxes, net of federal benefit		512			623
Earnings from bank owned life insurance		(9	)		(9	)
Low-income housing credits		–			(6	)
Change in valuation allowance		80			–
Tax effect of stock-based compensation		14			25
Other, net		18			75
Total	$	1,985		$	2,413

Deferred Tax Assets and Liabilities

Year‑end deferred tax assets and liabilities were due to the following:

	2023			2022
	(In thousands)
Deferred tax assets:
Allowance for credit losses	$	2,008		$	1,063
Accrued liabilities		580			555
State income taxes		30			45
Stock compensation		196			226
Net operating loss carryforward		1,982			2,616
Partnership investment		340			257
General business credit		1,962			1,962
Alternative minimum tax credit		11			5
Net unrealized loss on securities available-for-sale		5,815			7,388
Right of use liability		196			266
Fair value adjustment on acquired loans		223			291
Other		212			332
Total deferred tax assets		13,555			15,006
Less: valuation allowance		(449	)		(369	)
Total deferred tax assets, net of valuation allowance		13,106			14,637
Deferred tax liabilities:
Section 481 adjustments to bad debts		–			(7	)
Deferred loan fees/costs		(1,743	)		(776	)
Basis difference on fixed assets		(748	)		(723	)
FHLB stock dividends		(98	)		(90	)
Nonaccrual loan interest		–			(8	)
Prepaid expenses		(180	)		(186	)
Right of use assets		(189	)		(256	)
Core deposit intangibles		(610	)		(719	)
Total deferred tax liabilities		(3,568	)		(2,765	)
Net deferred tax assets	$	9,538		$	11,872