Income Taxes

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Income Taxes

Note 3 – Income Taxes

Income tax expense differs from the amount computed by applying the statutory rate on book income subject to tax for the following reasons:

	(Thousands of Dollars)
	Years Ended December 31,
	2013			2012			2011
Income Tax at Statutory Rate	$	8,638		$	7,420		$	6,816
Tax Effect of:
Utility Plant Related		(527	)		(442	)		(620	)
State Income Taxes – Net		546			420			305
Employee Benefits		(46	)		(23	)		1
Other		10			8			25
Total Income Tax Expense	$	8,621		$	7,383		$	6,527

Income tax expense is comprised of the following:

	(Thousands of Dollars)
	Years Ended December 31,
	2013			2012			2011
Current:
Federal	$	5,018		$	2,994		$	3,550
State		688			430			395
Deferred:
Federal		2,855			3,832			2,594
State		139			206			67
Investment Tax Credits		(79	)		(79	)		(79	)
Total Income Tax Expense	$	8,621		$	7,383		$	6,527

The statutory review periods for income tax returns for the years prior to 2010 have been closed. In the event that there is interest and penalties associated with income tax adjustments in future examinations, these amounts will be reported under interest expense and other expense, respectively. There are no unrecognized tax benefits resulting from prior period tax positions. The Company is not aware of any uncertain tax positions that could result in a future tax liability.

Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial purposes and the amounts used for income tax purposes. The components of the net deferred tax liability are as follows:

	(Thousands of Dollars)
	December 31,
	2013			2012
Utility Plant Related	$	41,912		$	39,020
Customer Advances		(3,598	)		(3,673	)
Employee Benefits		1,121			6,523
Investment Tax Credits (ITC)		989			1,068
Other		(325	)		(94	)
Total Deferred Tax Liability and ITC	$	40,099		$	42,844