|12 Months Ended
Dec. 31, 2016
|Income Tax Disclosure [Abstract]
The provision for income taxes reflected in the statements of comprehensive income is comprised of the following components:
Income taxes provided were different than the tax expense computed by applying the statutory federal income tax rate of 35% to pre-tax income as a result of the following:
Deferred income tax liabilities and assets result from differences between assets and liabilities measured for financial reporting purposes and for income tax return purposes. These assets and liabilities are measured using the enacted tax rates and laws that are currently in effect. The net deferred tax asset and the temporary differences comprising that balance at December 31, 2016 and 2015 are as follows:
In the opinion of management, it is more likely than not that all of the deferred tax assets, with the exception of certain state net operating loss carry-forwards, certain state tax credit carry-forwards, and certain capital loss carry-forwards expected to expire prior to utilization, will be realized. Accordingly, a valuation allowance of $1.4 million is recorded at December 31, 2016. At December 31, 2016, the Company had state loss and tax credit carry-forwards of approximately $4.8 million, which expire at various dates from 2017 through 2035, federal capital loss carry-forwards of approximately $0.1 million which expire at various dates from 2019 through 2020, and federal tax credit carry-forwards of approximately $0.3 million which never expire.
The Company had no unrecognized tax benefits at December 31, 2016, December 31, 2015 and December 31, 2014.
A reconciliation of the beginning and ending unrecognized tax benefit is as follows:
It is the Company’s policy to recognize interest and penalties accrued relative to unrecognized tax benefits in their respective federal or state income taxes accounts. For the years ended December 31, 2016 and December 31, 2015, there were no previously accrued interest and penalties reversed in the income statement. For the year ended December 31, 2014, the company reversed previously accrued interest and penalties of $800,000. There were no amounts for accrued interest and penalties at December 31, 2016 and 2015.
The Company and its subsidiaries file a consolidated U.S. federal income tax return, as well as file various returns in states where its banking offices are located. The Company is no longer subject to U.S. federal or state tax examinations for years before 2013.