When deduct business licensing fees paid in prior year

[rwom1217]

If business licensing fees applicable to 2022 are paid in 2021 (In November/December for the upcoming year), which year's return should they be deducted?

[Anonymous_ · Accepted solution]

If the business is a cash basis taxpayer, then the expense is deducted in the year in which it is paid.

[rwom1217]

If a license fee is paid once every three years, would I deduct the whole amount in the year it is paid or can I only deduct the fraction that covers the year it was paid, and sort of lose the rest?

[Anonymous_]

Deduct it in the year it was paid.