XML 36 R24.htm IDEA: XBRL DOCUMENT v3.22.4
Income Taxes
12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Taxes

Note 15 -- Income Taxes

The components of federal and state income tax expense for the years ended December 31, 2022, 2021, and 2020 were as follows (in thousands):

 

 

 

2022

 

 

2021

 

 

2020

 

Current

 

 

 

 

 

 

 

 

 

Federal

 

$

14,401

 

 

$

12,269

 

 

$

12,315

 

State

 

 

6,171

 

 

 

6,384

 

 

 

7,120

 

Total current

 

 

20,572

 

 

 

18,653

 

 

 

19,435

 

Deferred

 

 

 

 

 

 

 

 

 

Federal

 

 

(2,005

)

 

 

(2,562

)

 

 

(3,318

)

State

 

 

(227

)

 

 

(793

)

 

 

(1,645

)

Total deferred

 

 

(2,232

)

 

 

(3,355

)

 

 

(4,963

)

Total

 

$

18,340

 

 

$

15,298

 

 

$

14,472

 

 

 

 

Recorded income tax expense differs from the expected tax expense (computed by applying the applicable statutory U.S. federal tax rate of 21% to income before income taxes). The principal reasons for the difference are as follows (in thousands):

 

 

 

 

2022

 

 

2021

 

 

2020

 

Expected income taxes

 

$

19,172

 

 

$

14,025

 

 

$

12,546

 

Effects of:

 

 

 

 

 

 

 

 

 

Tax-exempt income from bank owned life insurance

 

 

(659

)

 

 

(575

)

 

 

(363

)

Other tax exempt income

 

 

(2,497

)

 

 

(2,072

)

 

 

(1,758

)

Nondeductible interest expense

 

 

255

 

 

 

17

 

 

 

45

 

State taxes, net of federal taxes

 

 

4,695

 

 

 

4,417

 

 

 

4,325

 

Other items

 

 

(2,525

)

 

 

(514

)

 

 

(323

)

Effect of marginal tax rate

 

 

(101

)

 

 

 

 

 

 

Total

 

$

18,340

 

 

$

15,298

 

 

$

14,472

 

 

Tax expense recorded by the Company during 2022 and 2020 did not include any interest or penalties. Tax expense recorded during 2021 included interest of approximately $2,100. Tax returns filed with the Internal Revenue Service and Illinois Department of Revenue are subject to review by law under a three-year statute of limitations. The Company is no longer subject to U.S. federal or state income tax examinations by tax authorities for years before 2019.

The tax effects of the temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2022 and 2021 are presented below (in thousands):

 

 

 

2022

 

 

2021

 

Deferred tax assets:

 

 

 

 

 

 

Allowance for credit losses

 

$

16,248

 

 

$

12,957

 

Available-for-sale investment securities

 

 

61,880

 

 

 

339

 

Deferred compensation

 

 

4,157

 

 

 

4,025

 

Supplemental retirement

 

 

492

 

 

 

460

 

Deferred loan costs

 

 

302

 

 

 

 

Stock compensation expense

 

 

147

 

 

 

163

 

Deferred revenue

 

 

349

 

 

 

79

 

Purchase accounting

 

 

795

 

 

 

443

 

Acquisition costs

 

 

179

 

 

 

217

 

Other

 

 

894

 

 

 

1,139

 

Total gross deferred tax assets

 

 

85,443

 

 

 

19,822

 

Deferred tax liabilities:

 

 

 

 

 

 

Intangibles amortization

 

 

6,398

 

 

 

107

 

Prepaid expenses

 

 

1,418

 

 

 

6,480

 

FHLB stock dividend

 

 

22

 

 

 

985

 

Deferred expenses

 

 

104

 

 

 

23

 

Purchase accounting

 

 

 

 

 

915

 

Depreciation

 

 

4,911

 

 

 

3,463

 

Accumulated accretion

 

 

245

 

 

 

111

 

Mortgage servicing rights

 

 

91

 

 

 

118

 

Other

 

 

 

 

 

321

 

Available-for-sale investment securities

 

 

 

 

 

 

Total gross deferred tax liabilities

 

 

13,189

 

 

 

12,523

 

Deferred tax assets, net

 

$

72,254

 

 

$

7,299

 

 

No valuation allowance related to deferred tax assets was recorded at December 31, 2022 and 2021 as management believes it is more likely than not that the deferred tax assets will be fully realized.