Company: NWFL
Filing Date: 2025-10-28
Form Type: 424B3
Source: 0001193125-25-252482
Chunk: 217

Company: NORWOOD FINANCIAL CORP
Filing Date: 2025-10-28
Form: 424B3
Chunk 217
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 CONSOLIDATED FINANCIAL STATEMENTS 8. Income Taxes The components of income tax expense consisted of the following for the years ended December 31 (in thousands):

|                                |     |   | 2024 |   |     |   | 2023 |   |
|:-------------------------------|:----|:--|-----:|:--|:----|:--|-----:|:--|
| Current tax expense            |     | $ |  561 |   |     | $ |  766 |   |
| Deferred tax expense (benefit) |     |   |  (86 | ) |     |   | (221 | ) |
| Income Tax Expense             |     | $ |  475 |   |     | $ |  545 |   |

A reconciliation of the statutory federal income tax at a rate of 21% to federal income tax expense (benefit) included in the consolidated statements of income for the years ended December 31, 2024 and 2023, respectively are as follows:

|                                        |     |   | 2024 |   |     |   | 2023 |   |
|:---------------------------------------|:----|:--|-----:|:--|:----|:--|-----:|:--|
| Federal income tax at statutory rate   |     | $ |  472 |   |     | $ |  517 |   |
| Bank owned life insurance income       |     |   |  (46 | ) |     |   |  (41 | ) |
| Nondeductible share-based compensation |     |   |   45 |   |     |   |   54 |   |
| Other                                  |     |   |    4 |   |     |   |   15 |   |
| Income Tax Expense                     |     | $ |  475 |   |     | $ |  545 |   |

The tax effects of temporary differences that give rise to significant portions of the net deferred tax asset at December 31, 2024 and 2023 are as follows (in thousands):

| Deferred tax assets:                               |     | 2024 |       |     | 2023 |       |
|:---------------------------------------------------|:----|:-----|------:|:----|:-----|------:|
| Allowance for credit losses on loans               |     | $    |   915 |     | $