INCOME TAXES (Tables)
|
12 Months Ended |
Dec. 31, 2025 |
|---|
| Income Tax Disclosure [Abstract] |
|
| Schedule of Components of Income Tax Expense |
Income tax expense for the year ended December 31, 2025, 2024, and 2023 is listed in the following table. The Company does not conduct business outside the United States and has no foreign income or foreign tax expense.
|
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|
2025 |
|
|
2024 |
|
|
2023 |
|
Current income tax expense |
|
|
|
|
|
|
|
|
|
Federal |
|
$ |
7,960 |
|
|
$ |
13,847 |
|
|
$ |
(3,072 |
) |
State |
|
|
799 |
|
|
|
1,017 |
|
|
|
101 |
|
Total current income tax expense |
|
|
8,759 |
|
|
|
14,864 |
|
|
|
(2,971 |
) |
Deferred income tax expense (benefit) |
|
|
|
|
|
|
|
|
|
Federal |
|
|
(4,468 |
) |
|
|
2,703 |
|
|
|
(2,349 |
) |
State |
|
|
(637 |
) |
|
|
(1,907 |
) |
|
|
(86 |
) |
Total deferred income tax expense (benefit) |
|
|
(5,105 |
) |
|
|
796 |
|
|
|
(2,435 |
) |
Total income tax expense |
|
$ |
3,654 |
|
|
$ |
15,660 |
|
|
$ |
(5,406 |
) |
|
| Schedule of Effective Income Tax Rate Reconciliation |
The Company adopted ASU 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” on a prospective basis beginning with the year ended December 31, 2025. A reconciliation of income tax expense at the U.S. federal statutory rate (21% in 2025) to the Company’s actual income tax expense for the year ended December 31, 2025 is shown below.
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|
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|
2025 |
|
|
ETR |
|
Computed at the Statutory rate |
|
$ |
5,540 |
|
|
|
21.0 |
% |
Increase (decrease) resulting from: |
|
|
|
|
|
|
State and local taxes, net of federal benefit(1) |
|
|
491 |
|
|
|
1.9 |
% |
Tax Credits |
|
|
|
|
|
|
Federal tax credits |
|
|
(8 |
) |
|
|
0.0 |
% |
PAM investments |
|
|
(453 |
) |
|
|
(1.7 |
)% |
Non-taxable or non-deductible items |
|
|
|
|
|
|
Tax-exempt interest |
|
|
(524 |
) |
|
|
(2.0 |
)% |
Non-taxable life insurance income |
|
|
(1,620 |
) |
|
|
(6.1 |
)% |
Captive income excluded |
|
|
(331 |
) |
|
|
(1.3 |
)% |
Transaction costs |
|
|
338 |
|
|
|
1.3 |
% |
Executive compensation |
|
|
416 |
|
|
|
1.6 |
% |
Other |
|
|
436 |
|
|
|
1.6 |
% |
Other |
|
|
|
|
|
|
Tax interest or expense included in income |
|
|
(631 |
) |
|
|
(2.4 |
)% |
Income tax expense |
|
$ |
3,654 |
|
|
|
13.9 |
% |
|
|
|
|
|
|
|
(1) State taxes in Kansas made up the majority (greater than 50%) of the tax effect in this category. |
|
The following table presents the required disclosures prior to our adoption of ASU 2023-09 and a reconciliation of income tax expense at the U.S. federal statutory rate (21% in 2024 and 2023) to the Company’s actual income tax expense for the year ended December 31, 2024, and 2023.
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
Computed at the statutory rate |
|
$ |
16,439 |
|
|
$ |
507 |
|
Increase (decrease) resulting from: |
|
|
|
|
|
|
State and local taxes, net of federal benefit |
|
|
364 |
|
|
|
(517 |
) |
Tax-exempt interest |
|
|
(332 |
) |
|
|
(412 |
) |
Non-taxable life insurance income |
|
|
(1,043 |
) |
|
|
(852 |
) |
Non-deductible expenses |
|
|
426 |
|
|
|
814 |
|
Share-based payments |
|
|
(477 |
) |
|
|
2 |
|
Federal tax credits |
|
|
(92 |
) |
|
|
(3,715 |
) |
Investments reported under proportional amortization method |
|
|
(1,441 |
) |
|
|
(1,253 |
) |
Bargain purchase gain |
|
|
(448 |
) |
|
— |
|
Change in valuation allowance |
|
|
(1,410 |
) |
|
|
98 |
|
Other |
|
|
316 |
|
|
|
171 |
|
Non-deductible transactions costs |
|
|
56 |
|
|
|
62 |
|
Captive insurance company |
|
|
(273 |
) |
|
|
(311 |
) |
BOLI surrender |
|
|
3,575 |
|
|
— |
|
Income tax expense |
|
$ |
15,660 |
|
|
$ |
(5,406 |
) |
|
| Components of Deferred Tax Assets and Liabilities |
Components of deferred tax assets and liabilities at December 31, 2025 and 2024 are shown in the table below.
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|
2025 |
|
|
2024 |
|
Deferred tax assets |
|
|
|
|
|
|
Allowance for credit losses |
|
$ |
13,423 |
|
|
$ |
10,812 |
|
Tax credit carryforwards |
|
|
5,137 |
|
|
|
635 |
|
Goodwill amortization |
|
|
1,657 |
|
|
|
1,952 |
|
Accrued compensation |
|
|
2,800 |
|
|
|
2,270 |
|
Net operating loss and attribute carryforwards |
|
|
3,700 |
|
|
|
3,473 |
|
Net unrealized (gains) losses on securities and cash flow hedges |
|
|
— |
|
|
|
17,544 |
|
Other real estate owned |
|
|
667 |
|
|
|
661 |
|
Acquired loans fair market value adjustments |
|
|
2,874 |
|
|
|
81 |
|
Deferred Revenue |
|
|
1,844 |
|
|
|
209 |
|
Acquired securities retained |
|
|
772 |
|
|
|
1,114 |
|
Other |
|
|
1,126 |
|
|
|
650 |
|
Gross deferred tax assets |
|
|
34,000 |
|
|
|
39,401 |
|
Deferred tax liabilities |
|
|
|
|
|
|
Assumed debt fair market value adjustments |
|
|
961 |
|
|
|
1,061 |
|
Depreciation |
|
|
5,793 |
|
|
|
5,222 |
|
Federal Home Loan Bank stock dividends |
|
|
89 |
|
|
|
121 |
|
Core deposit intangibles |
|
|
4,455 |
|
|
|
2,644 |
|
Net unrealized (gains) losses on securities and cash flow hedges |
|
|
2,285 |
|
|
|
— |
|
Prepaid expenses |
|
|
704 |
|
|
|
684 |
|
Other |
|
|
977 |
|
|
|
841 |
|
Gross deferred tax liabilities |
|
|
15,264 |
|
|
|
10,573 |
|
Valuation allowance |
|
|
(752 |
) |
|
|
(852 |
) |
Net deferred tax asset (liability) |
|
$ |
17,984 |
|
|
$ |
27,976 |
|
|
| Summary of Income Taxes Paid (Net of Refunds Received) |
The Company adopted ASU 2023-09 on a prospective basis for the year December 31, 2025 and have included the following table as a result of our adoption, which presents income taxes paid (net of refunds received) for the year ended December 31, 2025. For the years ended 2024 and 2023, income taxes paid, net of refunds was $6,195 and $3,467.
|
|
|
|
|
|
|
2025 |
|
Income taxes |
|
|
|
Federal |
|
$ |
(11,152 |
) |
State |
|
|
(174 |
) |
Income taxes paid, net of refunds |
|
$ |
(11,326 |
) |
|