Note 7 - Income Taxes

9 Months Ended

Sep. 30, 2015

Notes

Note 7 - Income Taxes

Note 7 – Income Taxes

Effective income tax rates were 24% and 14% during the three- and nine-month periods ended September 30, 2015, respectively, compared to 13% and 10% during the same periods ended 2014, respectively.  The Company has elected to be, and is, treated as an S corporation for income tax reporting purposes.  Taxable income or loss of an S corporation is passed through to, and included in the individual tax returns, of the shareholders of the Company, rather than being taxed at the corporate level.  Notwithstanding this election, income taxes are reported for, and paid by, the Company's insurance subsidiaries, as they are not allowed by law to be treated as S corporations, as well as for the Company in Louisiana, which does not recognize S corporation status.  The tax rates of the Company’s insurance subsidiaries are below statutory rates due to investments in tax exempt bonds held by the Company’s insurance subsidiaries.