CPA Associates, a cash- basis partnership with a calendar tax year, signs a contract for a 20- month subscription to an online tax research service, effective as of April 1. The firm pays the full $10,000 subscription bill on the April 1, 2018 subscription start date. For 2018 the firm can deduct

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Under the cash basis method, expenses are generally deductible in the year they are paid. Since CPA Associates paid the full $10,000 in 2018, they can deduct the entire amount in that year.

CPA Associates, a Cash- Basis Partnership with a Calendar Tax