Entity information:
NOTE 7 — Income Taxes
The following summarizes components of income tax expense for the years ended December 31:
     
2017
    
2016
    
2015
  
Current                                      
Federal expense
       $ 1,955         $ 147         $ 37    
State and city expense
         387           98           81    
Total current tax expense
         2,342           245           118    
Deferred                                      
Federal expense
         444           1,474           641    
State and city expense
         604           47           (95)    
Total deferred tax expense
         1,048           1,521           546    
Tax expense
       $ 3,390         $ 1,766         $ 664    
 
The following is a reconciliation of the Company’s statutory federal income tax rate of 35% for 2017, and 34% for 2016 and 2015 to its effective tax rate at December 31:
     
2017
    
2016
    
2015
  
Federal tax expense at statutory rate
       $ 2,462         $ 1,560         $ 624    
State and local income taxes, net of federal income taxes
         200           97           (16)    
Incentive stock options
         32           71           4    
Change to deferred tax as a result of tax reform
         683           —           16    
Other
         13           38           36    
Net tax expense
       $ 3,390         $ 1,766         $ 664    
 
The following summarizes the components of the Company’s deferred tax assets and deferred tax liabilities at December 31:
     
2017
    
2016
  
Deferred tax assets:                          
Net operating loss carry forwards
       $ 429         $ 1,136    
Pre-opening costs
         92           172    
Stock options expense
         130           308    
Allowance for loan loss
         1,044           1,208    
Fixed assets
         27           (31)    
Unrealized loss on securities available-for-sale
         524           565    
Other
         145           145    
Total deferred tax assets
         2,391           3,503    
Deferred tax liabilities:                          
Deferred rent
         (37)           (43)    
Deferred loan fees
         (113)           (352)    
Total deferred tax liabilities
         (150)           (395)    
Net deferred tax assets
       $ 2,241         $ 3,108    
 
The Company has New York state, and city net operating loss carryforwards of  $9,507, and $2,066, respectively, as of December 31, 2017. The net operating losses are available to reduce future taxable income and begin to expire in 2026.
Realization of deferred tax assets is dependent upon the generation of future taxable income. A valuation allowance is provided when it is more likely than not that some portion of the deferred tax asset will not be realized. Based on its evaluation, the Company has determined that it is more likely than not that the deferred tax asset as of December 31, 2017 and 2016, will be realized.
On December 22, 2017, H.R.1 commonly known as the Tax Cuts and Jobs Act was signed into law. Among other things, the act reduces our corporate federal tax rate from 35% to 21% effective January 1, 2018. As a result we are required to remeasure, through income tax expense, our deferred tax assets and liabilities using the enacted rates. The remeasurement of our net deferred tax asset resulted in additional income tax expense of  $683 for the year ended December 31, 2017.
The Company does not have any unrecognized tax benefits at December 31, 2017 or 2016, and does not expect this to increase in the next twelve months. There were no interest and penalties recorded in the statements of operations for the years ended December 31, 2017, 2016 and 2015. The Company is subject to U.S. federal income tax as well as income tax of the state of New York and New York City. The Company is no longer subject to examination by taxing authorities for years before 2014.