What is the correct way of handling the deduction of insurance premiums for rental properties if the premiums change year over year?
e.g. I pay wind insurance every here on August 1 for the coming 12 months.
If I follow the deduct when you pay approach I would deduct the full premium with that year's tax return.
In the past I also followed the "realization" approach, i.e. in 2019 I would deduct premiums Jan-Jul with the old premium (paid in 2017) and Aug to Dec with the new premium paid in 2018.
Which one is correct?
Does this approach change in a case when I paid advance premium for a 5 year coverage?
