Sarah Owes a Deductible Expense That She Can Either Pay

question 63

Multiple Choice

Sarah owes a deductible expense that she can either pay (and deduct) this year or next year.She is in the 25% marginal tax rate bracket.Which of the following statements about this payment is/are correct?
I.Deductions should always be taken in the current year.Sarah should pay the expense this year.
II.If Sarah expects to be in the 28% marginal tax rate bracket next year,she should pay the expense next year.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct.
• D)Neither statement is correct.

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