Grynberg V. Commissioner
Taxpayers in the United States often seek to maximize their income and decrease their tax liability by prepaying deductible expenses and taking a deduction earlier rather than in a later tax year. In Grynberg v. Commissioner, the United States Tax Court held that one taxpayer’s prepaid business expenses were not ordinary and necessary expenses of the years in which they were made, and therefore the prepayments were not tax deductible.
Read more about Grynberg V. Commissioner: The Time Value of Money, or “Why Timing Matters”, Facts of Grynberg, The Parties’ Contentions, The Test, Application of The Test, A Split in The Courts