NOTE 5 - INCOME TAXES

6 Months Ended

Jun. 30, 2021

Notes to Financial Statements

Income Taxes

NOTE 5 – INCOME TAXES

A reconciliation of the expected federal income tax expense to the income tax expense included in the consolidated statements of income is as follows for the three and six months ended June 30, 2021 and June 30, 2020:

	For the Three Months Ended June 30,								For the Six Months Ended June 30,
	2021				2020				2021				2020
			% of				% of				% of				% of
			Pretax				Pretax				Pretax				Pretax
	Amount		Income		Amount		Income		Amount		Income		Amount		Income
	(dollars in thousands)
Computed "expected" tax expense	$	5,699	21.0	%	$	3,472	21.0	%	$	10,219	21.0	%	$	6,226	21.0	%
Tax exempt income, net		(1,802)	(6.6)			(1,247)	(7.5)			(3,521)	(7.2)			(2,472)	(8.3)
Bank-owned life insurance		(95)	(0.4)			(115)	(0.7)			(194)	(0.4)			(170)	(0.6)
State income taxes, net of federal benefit, current year		1,247	4.6			776	4.7			2,271	4.7			1,453	4.9
Tax credits		(57)	(0.2)			(116)	(0.7)			(114)	(0.2)			(232)	(0.8)
Excess tax benefit on stock options exercised and restricted stock awards vested		(40)	(0.1)			2	—			(204)	(0.4)			(262)	(0.9)
Other		(164)	(0.6)			26	0.1			(128)	(0.3)			139	0.5
Federal and state income tax expense	$	4,788	17.6	%	$	2,798	16.9	%	$	8,329	17.2	%	$	4,682	15.8	%