Entity information:
10
. Income Taxes
 
The components of income tax expense
from operations are as follows:
                   
December 31, (In thousands)
  
20
17
    
201
6
    
201
5
  
Currently payable
   $
6,502
     $
5,556
     $
3,662
  
Revaluation of deferred income taxes resulting from change in statutory tax rates
    
5,869
      
-
      
-
  
Deferred
    
270
      
885
      
1,631
  
Total income tax
expense
   $
12,641
     $
6,441
     $
5,293
  
 
An analysis of the difference between the effective income tax rates and the statutory federal income tax rate follows.
                   
December 31,
  
201
7
    
201
6
    
201
5
  
Federal statutory rate
    
35.0
 %    
35.0
 %    
35.0
 %
Changes from statutory
rates resulting from:
                        
Revaluation of deferred income taxes resulting from changes in statutory tax rates
    
24.1
      
-
      
-
  
Tax-exempt interest
    
(4.1
 )    
(4.6
 )    
(5.8
 )
Nondeductible interest to carry tax-exempt obligations
    
.1
      
.2
      
.2
  
Premium income not subject
to tax
    
(1.4
 )    
(1.3
 )    
(1.5
 )
Company-owned life insurance
    
(1.6
 )    
(1.5
 )    
(1.6
 )
Other, net
    
(.1
 )    
.1
      
(.2
 )
Effective tax rate on pretax income
    
52.0
 %    
27.9
 %    
26.1
 %
 
The tax effects of the significant temporary differences that comprise deferred tax assets and liabilities at
December 31,
2017
and
2016
are as follows:
             
December 31, (In thousands)
  
201
7
    
201
6
  
Assets
  
 
 
 
  
 
 
 
Allowance for loan losses
   $
2,058
     $
3,285
  
Deferred
compensation
    
135
      
236
  
Postretirement benefit obligations
    
3,605
      
5,825
  
Other real estate owned
    
621
      
1,303
  
Self-funded insurance
    
114
      
232
  
Paid time off
    
472
      
815
  
Depreciation
    
1,059
      
1,630
  
Intangibles
    
806
      
1,878
  
Unrealized loss on available for sale investment
securities, net
    
933
      
1,811
  
Other
    
147
      
239
  
Total deferred tax assets
    
9,950
      
17,254
  
Liabilities
  
 
 
 
  
 
 
 
Prepaid expenses
    
-
      
153
  
Federal Home Loan Bank stock dividends
    
621
      
1,035
  
Deferred loan fees
    
523
      
846
  
Other
    
31
      
52
  
Total deferred tax liabilities
    
1,175
      
2,086
  
Net deferred tax asset
   $
8,775
     $
15,168
  
 
The Tax Cuts and Jobs Act ("Tax Act") was enacted on
December 22, 2017.
Among other changes, the Tax Act reduces the US Federal corporate tax rate from
35%
to
21%.
At
December 31, 2017,
the Company has substantially
completed its accounting for the tax effects of enactment of the Tax Act. For deferred tax assets and liabilities, amounts were remeasured based on the rates expected to reverse in the future, which is now
21%.
The Company continues to analyze certain aspects of the Tax Act and further refinements are possible, which could potentially affect the measurement of these balances or potentially give rise to new deferred tax amounts, although management does
not
expect these adjustments to materially impact the financial statements.
 
In assessing the realizability of deferred tax assets, management considers whether it is more likely than
not
that some portion or all of the deferred tax assets will
not
be realized. The ultimate realization of deferred tax asse
ts is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more likely than
not
the Company will realize the benefits of these deductible differences at
December 31, 2017.
 
The Company had
no
unrecognized tax benefits at year-end
2017,
2016,
and
2015
and did
not
recognize any increase in unrecognized benefits during
2017
relative to any tax
position taken in
2017.
The Company’s policy is to record the accrual of interest or penalties relative to unrecognized tax benefits, if any, in its income tax expense accounts. There was
no
amount accrued for interest at
December 31, 2017
and
2016.
No
penalties were accrued or recorded during any year in the
three
years ended
December 31, 2017.
 
The Company files U.S. federal and various state income tax returns. The Company is
no
longer subject to income tax examinations by taxing authorities for the year
s before
2014.