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Home 🌿 Marijuana Business News 🌿 Ninth Circuit: Legal Or Not, Marijuana Facility Cannot Deduct Its Expenses 🌿

Ninth Circuit: Legal Or Not, Marijuana Facility Cannot Deduct Its Expenses

Submitted by Marijuana News on Mon, 07/13/2015 - 08:45

Legalized medicinal marijuana is yesterdays’ news; legal recreational marijuana is the way of the world now, and with each passing year, additional states are considering the legalize-and-tax regime first instituted by Colorado and Washington. While state law is becoming more and more accepting of the idea of free-market marijuana, however, a decades-old provision of the federal tax code remains firmly in place, threatening to administer a painful amount of tax on marijuana facilities, and serving as a greater barrier to entry into the industry than any outdated notion of moral or ethical impropriety.

The IRS has been wielding a little known Code section — Section 280E, to be exact — to wage war on medicinal and recreational  marijuana facilities. Section 280E provides that no deduction — other than the cost to purchase or grow the marijuana inventory, or Cost of Goods Sold (COGS) — shall be allowed for any amount incurred in a business...

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URL: 
http://www.forbes.com/sites/anthonynitti/2015/07/10/ninth-circuit-legal-or-not-marijuana-facility-cannot-deduct-its-expenses/

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