Note 5 - INCOME TAXES

3 Months Ended

Mar. 31, 2022

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 months ended March 31, 2022 and March 31, 2021:

	For the Three Months Ended March 31,
	2022				2021
			% of				% of
			Pretax				Pretax
	Amount		Income		Amount		Income
	(dollars in thousands)
Computed "expected" tax expense	$	5,451	21.0	%	$	4,520	21.0	%
Tax exempt income, net		(2,222)	(8.6)			(1,719)	(8.0)
Bank-owned life insurance		(73)	(0.3)			(99)	(0.5)
State income taxes, net of federal benefit, current year		1,291	5.0			1,024	4.8
Provision adjustment from accounting method change		(1,181)	(4.5)			—	—
Tax credits		(242)	(0.9)			(57)	(0.3)
Income from tax credit equity investments		(301)	(1.2)			—	—
Acquisition costs		130	0.5			—	—
Excess tax benefit on stock options exercised and restricted stock awards vested		(434)	(1.7)			(164)	(0.8)
Other		(86)	(0.3)			36	0.2
Federal and state income tax expense	$	2,333	9.0	%	$	3,541	16.4	%