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The components of deferred federal income taxes are as follows: 

## NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 

<img src='content_image/1030525.jpg'>

A summary of the changes in the components of deferred federal and state income taxes is as follows: 

<img src='content_image/1030527.jpg'>

MGLIC, an entity that is not eligible to join the Company's consolidated tax return until 2020, had a $1.1 million net operating loss carryforward at December 31, 2019, which will begin expiring in 2036. 

The Company and our subsidiaries had no capital loss carryforwards at December 31, 2019, except MGLIC had a $21,000 capital loss carryforward at December 31, 2019, which will begin expiring in 2023. 

At December 31, 2019 and 2018, we determined that as a result of our taxable capital gain income in carryback periods, the expected reversal of existing deferred tax liabilities, and tax planning strategies, it was more likely than not that the deferred tax assets would be realized. Thus, the Company holds no valuation allowance in operations or other comprehensive income at December 31, 2019 and 2018. 

The Company recognizes only the impact of tax positions that, based on their technical merits, are more likely than not to be sustained upon an audit by the taxing authority. 

