Income Tax

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Income Tax

Note 16 – Income Tax

	December 31 2013			December 31 2012			December 31 2011
Income tax expense
Currently payable
Federal	$	3,900		$	5,582		$	4,034
State		(88	)		120			44
Deferred		3,236			2,744			108
Total income tax expense	$	7,048		$	8,446		$	4,186
Reconciliation of federal statutory to actual tax expense
Federal statutory income tax at 34%	$	9,424		$	9,800		$	5,774
Tax exempt interest		(1,517	)		(1,419	)		(1,416	)
Tax exempt income		(362	)		(359	)		(457	)
Other tax exempt income		(342	)		—			—
Nondeductible and other		(176	)		(177	)		216
Effect of state income taxes		21			601			69
Actual tax expense	$	7,048		$	8,446		$	4,186

	December 31 2013			December 31 2012
Assets
Allowance for loan losses	$	5,677		$	6,442
Net operating loss		2,977			1,452
Intangible assets		—			2,151
Director and employee benefits		1,828			1,357
Unrealized loss on securities available for sale		931			—
Other		537			581
Total assets		11,950			11,983
Liabilities
Depreciation		(1,424	)		(1,418	)
Difference in expense recognition		(368	)		(519	)
State tax		(236	)		(374	)
Federal Home Loan Bank stock dividends		(295	)		(296	)
Difference in basis of intangible assets		(2,189	)		—
FHLB Penalty		(508	)		(748	)
Unrealized gain on securities available for sale		—			(4,901	)
Other		(1,188	)		(580	)
Total liabilities		(6,208	)		(8,836	)
Net deferred tax asset	$	5,742		$	3,147

As of December 31, 2013, the Company had approximately $6.5 million of state tax loss carryforward available to offset future franchise taxable income. Also, at December 31, 2013, the Company had approximately $9.2 million of federal loss carryforward available to offset future federal income tax. The state loss carryforward begins to expire in 2023. The federal loss carryforward expires in 2029. Due to these losses being incurred by Heartland prior to the acquisition by Horizon, the annual losses which can be used are subject to an annual limitation. Management believes that the Company will be able to utilize the benefits recorded for both state and federal loss carryforwards within the allotted time periods.

The Company files income tax returns in the U.S. federal jurisdiction. With a few exceptions, the Company is no longer subject to U.S. federal, state and local or non-U.S. income tax examinations by tax authorities for years before 2010.