Deduct lawsuit judgment when determined or when paid for cash basis business?

Hello, I have a small business client that was hit with a discrimination lawsuit judgment for $40,000. The court entered the judgment in December 2025, but client will actually pay in 2026. Biz is on the cash basis of accounting

Question: Can biz deduct the $40k on the 2025 return since the judgment happened in 2025, or is it deductible only in 2026 when paid?

I’m thinking:

• Cash basis = deduct when paid (2026)

Thank you!