Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Net Deferred Tax Asset

Significant components of the Corporation’s net deferred tax asset at December 31, 2021 and 2020 are shown below.

(Dollars in thousands)	2021			2020
Deferred tax assets:
Allowance for loan and lease losses	$	3,065		$	2,810
Loan fees		1,409			1,908
Deferred compensation		2,661			722
Benefit plans		98			68
Unrealized loss on securities		63			—
Lease adjustments		485			219
Business combination adjustments		4,067			148
Acquired NOL, Section 1231, and charitable contribution carryforwards		745			91
Acquired AMT carryforward		777			—
Other		1,038			101
		14,408			6,067
Deferred tax liabilities:
Depreciation		(843	)		(394	)
Bond accretion		(39	)		(30	)
Goodwill and intangibles		(364	)		(359	)
Prepaid expenses		(706	)		(474	)
Business combination adjustments		(547	)		(641	)
Benefit plans		(1,130	)		(549	)
Unrealized gain on securities		—			(1	)
		(3,629	)		(2,448	)
Deferred tax asset, net	$	10,779		$	3,619

Provision for Income Taxes

The provision for income taxes consists of the following:

(Dollars in thousands)	2021		2020			2019
Current tax provision
Federal	$	6,178	$	6,340		$	2,875
State		70		157			185
Total current tax provision		6,248		6,497			3,060
Deferred tax expense (benefit)
Federal	$	484		(1,367	)	$	665
State		—		—			—
Total deferred tax expense	$	484		(1,367	)		665
Total provision for income taxes	$	6,732	$	5,130		$	3,725

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of the federal income tax provision at the statutory rate of 21% for 2021, 2020 and 2019 to Mid Penn's actual federal income tax provision at its effective rate is as follows:

(Dollars in thousands)	2021			2020			2019
Provision at the expected statutory rate	$	7,571		$	6,581		$	4,499
Effect of tax-exempt income		(477	)		(499	)		(683	)
Effect of investment in life insurance		(75	)		(63	)		(66	)
State income taxes, net of federal tax benefit		55			124			146.0
Nondeductible interest		14			26			59
Low income housing partnership tax credits		(853	)		(861	)		(83	)
Nondeductible merger and acquisition expense		364			—			—
Other items		133			(178	)		(147	)
Provision for income taxes	$	6,732		$	5,130		$	3,725