Since it's using the cash basis of accounting, like any other expense the S-corp (or for that matter any other cash-basis taxpayer) incurs it's deductible when paid not incurred. That's literally what cash basis means. However, there is an exception, if the credit card was in the name of the business then you can deduct the expense in the year you put it on the CC. This seems contrary to what I have written above. when you put the charge on a business CC the IRS considers it paid because the CC company pays the vendor not the Corp. The Corp's responsibility is to pay the CC company. this may sound like splitting hairs but that what the IRS says. the same would be true if you incurred medical expenses or other deductible schedule A expenses, they're deductible in the year they go on the CC. on
The reason you can't deduct them is that it is a personal credit card. same situation as far as the CC Company but the liability to pay the CC is yours not the corp. I will say that what H&R did, I've seen in other cases so there are probably others out there that would disagree with me.
