Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Income Tax Disclosure [Abstract]

Provision for Income Tax

Our provision for income tax for 2017, 2016 and 2015 consisted of the following:

	2017			2016		2015
Current	$	(2,139,061	)	$	8,496,405	$	5,621,367
Deferred		7,137,423			2,030,865		980,868
Federal income tax provision	$	4,998,362		$	10,527,270	$	6,602,235

Reconciliation of Federal Income Tax Rate

The reasons for such difference and the related tax effects are as follows:

	2017			2016			2015
Income before income taxes	$	12,114,462		$	41,328,407		$	27,592,268
Computed “expected” taxes		4,240,062			14,464,942			9,657,294
Tax-exempt interest		(3,241,530	)		(3,951,926	)		(4,806,855	)
Proration		518,948			629,697			737,644
Effect of tax reform		4,752,547			—			—
Dividends received deduction		(508,409	)		(691,616	)		(701,658	)
Tax benefit on exercise of options		(873,515	)		—			—
Other, net		110,259			76,173			1,715,810
Federal income tax provision	$	4,998,362		$	10,527,270		$	6,602,235

Schedule of Deferred Tax Assets and Deferred Tax Liabilities

The tax effects of temporary differences that give rise to significant portions of our deferred tax assets and deferred tax liabilities at December 31, 2017 and 2016 are as follows:

	2017			2016
Deferred tax assets:
Unearned premium	$	15,511,854		$	23,964,558
Loss reserves		4,164,246			6,460,683
Net operating loss carryforward - Le Mars		683,979			1,271,411
Alternative minimum tax credit carryforward		—			7,357,733
Net state operating loss carryforward - DGI Parent		77,132,006			72,049,234
Net unrealized losses		713,549			1,213,836
Other		2,300,595			3,307,286
Total gross deferred tax assets		100,506,229			115,624,741
Less valuation allowance		(77,396,473	)		(72,490,012	)
Net deferred tax assets		23,109,756			43,134,729
Deferred tax liabilities:
Deferred policy acquisition costs		12,660,871			19,708,220
Other		3,320,042			4,383,096
Total gross deferred tax liabilities		15,980,913			24,091,316
Net deferred tax asset	$	7,128,843		$	19,043,413