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Income Taxes
6 Months Ended
Dec. 31, 2023
Income Taxes  
Income Taxes

Note 8- Income Taxes

Income tax expense was $172,000 for the six months ended December 31, 2023, a decrease of $36,000, as compared to income tax expense of $208,000 for the six months ended December 31, 2022. The decrease in income tax expense was primarily the result of a decrease in income before income taxes of $490,000 which was offset by a change in Wisconsin tax law that provides for a subtraction from the Bank’s state taxable income for loan and fee interest income from certain commercial and agricultural loans. Based upon the provisions of this new state tax law, management determined that the Company was highly unlikely to incur a material Wisconsin tax liability in the foreseeable future, instead generating Wisconsin net operating loss carryforwards that would never be realized.  Since the state rate at which net deferred tax assets are expected to be realized is 0%, the Company eliminated its state net deferred tax asset balances as of July 1, 2023, resulting in deferred tax expense of approximately $112,000 for the six months ended December 31, 2023. A summary of income tax expense compared to the federal income tax statutory rate is set forth below.

    

2023

    

2022

At Federal statutory rate at 21%

$

111,421

$

214,350

Adjustments resulting from:

Wisconsin change in tax law

112,058

-

Earnings on bank owned life insurance

(25,449)

(61,463)

State tax, net of federal benefit

-

51,511

Other

(25,748)

3,768

Income tax expense

$

172,282

$

208,166