v3.26.1
Income Taxes
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The following is a summary of the provision for income taxes included in the Consolidated Statements of Income:

 December 31,
(in thousands)20252024
Current:
   Federal$(73)$3,178 
   State(1)
(417)340 
   Total Current(490)3,518 
Deferred:
   Federal(11,817)40 
   State(231)— 
   Total Deferred(12,048)40 
Total$(12,538)$3,558 
(1) For the years presented , Texas, West Virginia and Kentucky make up the taxes in this category.

The following table presents income taxes paid, net of refunds for the periods below:

 December 31,
(in thousands)20252024
Federal$4,100 $— 
State50 — 
Total$4,150 $— 

The difference between income taxes computed by applying the statutory federal income tax rate and the provision for income taxes in the financial statements is reconciled as follows:

 December 31, 2025December 31, 2024
(in thousands except for %)AmountRateAmountRate
Federal income taxes at statutory rate$(14,398)(21.0)%$3,361 21.0 %
State tax, net of federal income tax effect (1)
(512)(0.8)%268 1.7 %
Tax exempt municipal income(152)(0.2)%(146)(0.9)%
Goodwill impairment not deductible2,709 4.0 %— — %
Other(185)(0.3)%75 0.4 %
Total$(12,538)(18.3)%$3,558 22.2 %
(1) For the years presented , Texas, West Virginia and Kentucky make up the taxes in this category.
Deferred taxes are recorded based upon differences between the financial statement and tax basis of assets and liabilities, and available tax credit carry forwards. Temporary differences between the financial statement and tax values of assets and liabilities give rise to deferred taxes. The significant components of deferred taxes classified in First Guaranty's Consolidated Balance Sheets at December 31, 2025 and 2024 are as follows:

 December 31,
(in thousands)20252024
Deferred tax assets:  
Allowance for credit losses$8,907 $7,596 
Unrealized losses on available for sale securities— 677 
Unrealized losses on available for sale securities transferred to held to maturity2,458 2,743 
Net operating loss10,638 822 
Other705 277 
Gross deferred tax assets22,708 12,115 
Deferred tax liabilities:  
Depreciation and amortization(1,668)(2,058)
Core deposit intangibles(485)(622)
Discount on purchased loans(99)(118)
Other real estate owned(75)— 
Unrealized gains on available for sale securities(515)— 
Other(1,196)(1,367)
Gross deferred tax liabilities(4,038)(4,165)
Net deferred tax assets (liabilities)$18,670 $7,950 

First Guaranty determined that the net deferred tax asset at December 31, 2025 and 2024 was more likely than not to be realized based on an assessment of all available positive and negative evidence, and therefore no valuation allowance was recorded.

Net operating loss carryforwards for income tax purposes were $49.7 million and $3.9 million as of December 31, 2025 and 2024, respectively. The carryforwards were the result of the net operating loss generated in 2025 of $46.2 million and amounts acquired in 2017 in the Premier acquisition. The acquisition related losses expire from 2027 to 2034, and will be utilized subject to annual Internal Revenue Code Section 382 limitations. The net operating loss generated in 2025 can offset up to 80% of future taxable income and can be carried forward indefinitely.

ASC 740-10, Income Taxes, clarifies the accounting for uncertainty in income taxes and prescribes a recognition threshold and measurement attribute for the consolidated financial statements recognition and measurement of a tax position taken or expected to be taken in a tax return. First Guaranty does not believe it has any unrecognized tax benefits included in its consolidated financial statements. First Guaranty has not had any settlements in the current period with taxing authorities, nor has it recognized tax benefits as a result of a lapse of the applicable statute of limitations. First Guaranty recognizes interest and penalties accrued related to unrecognized tax benefits, if applicable, in noninterest expense. During the years ended December 31, 2025 and 2024, First Guaranty did not recognize any interest or penalties in its consolidated financial statements, nor has it recorded an accrued liability for interest or penalty payments.