Is a bonus payment deductible for a C-Corp if paid in the subsequent year?
Yes. As long as the bonus payment happens within 2 1/2 months of the company’s taxable year-end, the company can take a deduction on the current tax return.
For example, for a tax year-end date of December 31st, the corporation would be able to deduct bonuses for the Year 1 tax return as long as they are paid by March 15th, Year 2:
You might also be interested in...
Is a bonus deductible on a tax return if paid in the following year for a C Corp?
For a C Corporation (C Corp), the company can deduct the bonus payment as long as the payment is made within 2.5 months from the company’s taxable year-end. The one exception is that if the bonus is for a shareholder, then the deduction would apply to the year that the bonus payment is made during. […]