v3.25.2
Note 10 - Income Taxes
 12 Months Ended
Jun. 30, 2025
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

NOTE 10—INCOME TAXES

 

The provision for income taxes consisted of the following for the years ended June 30, calculated utilizing a statutory federal income tax rate of 21.0%:

 

   

2025

    

2024

  

Current income taxes

   $ 2,115     $ 2,087  

Deferred income tax benefit

     (458

)

     (242 )

Total income tax expense

   $ 1,657     $ 1,845  

 

The net deferred income tax asset (liability) consisted of the following components at June 30:

 

   

2025

    

2024

  

Deferred tax assets:

                

Allowance for credit losses

   $ 1,859     $ 1,743  

Deferred compensation

     1,160       1,026  

Limited partnership interests

     503       154  

Deferred income

     116       132  

Non-accrual loan interest income

     19       22  

Net unrealized securities loss

     5,995       7,532  

Other

     25       3  

Gross deferred tax asset

     9,677       10,612  
                 

Deferred tax liabilities:

                

Depreciation

     (771

)

     (776

)

Loan fees

     (711

)

     (663

)

FHLB stock dividends

     (102

)

     (102

)

Prepaid expenses

     (205

)

     (176

)

Intangible assets

     (330

)

     (258

)

Gross deferred tax liabilities

     (2,119

)

     (1,975

)

Net deferred tax asset

   $ 7,558     $ 8,637  

 

The difference between the provision for income taxes and amounts computed by applying the statutory income tax rate of 21.0% to income before taxes consisted of the following for the years ended June 30:

 

   

2025

    

2024

  

Income taxes computed at the statutory rate on pretax income

   $ 2,168     $ 2,189  

Tax exempt income

     (308

)

     (221

)

Cash surrender value income

     (82

)

     (58

)

Affordable housing tax credit

     (118

)

     (66 )

Tax credit

     (16 )     (16 )

Other non-deductible expenses

     13       17  

Total income tax expense

   $ 1,657     $ 1,845  

Effective tax rate

     16.0 %     17.7 %

 

The Company is subject to U.S. federal income tax as an income-based tax and the Bank is subject to a capital-based financial institutions tax in the State of Ohio. At June 30, 2025 and June 30, 2024, the Company had no unrecognized tax benefits recorded. The Company does not expect the total amount of unrecognized tax benefits to significantly increase within the next twelve months. There were no interest or penalties recorded for the years ended June 30, 2025 and 2024 and there were no amounts accrued for interest and penalties at June 30, 2025 and 2024. The Company is no longer subject to examination by taxing authorities for years before 2021.

 

On July 4, 2025, President Trump signed into law the legislation formally titled “An Act to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14” and commonly referred to as the One Big Beautiful Bill (the Act). The Company is currently evaluating the income tax implications of the Act; however, the Company does not expect the Act to have a material impact on the Company’s financial statements.