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What Is The Medical Marijuana Industry Supposed To Do At Tax Time Since Their Crop Is Illegal?

5 months ago
in Financing
Reading Time: 4 mins read
Benefits of Accounting and Financial Management

Running a enterprise isn’t simple, however women and men within the state-legal medical marijuana business have it worse than everybody else due to outdated federal legal guidelines. The means present legal guidelines are written, although these folks run a state-legal enterprise they don’t seem to be allowed to deduct all of their bills the way in which different enterprise homeowners get to do at tax time. And for some, meaning they may find yourself owing extra taxes than all the 12 months’s revenue.

This leaves dispensary homeowners, growers, medible makers and everybody else within the 23 states with a state-legal medical marijuana business confused about precisely what they’re alleged to do at tax time. And, because the legal guidelines are the issue, even a superb accountant cannot present the solutions they wish to hear.

Most of those small enterprise homeowners have by no means run a retailer or enterprise earlier than, and now they’re discovering that they cannot compete utilizing the identical guidelines as everybody else. These women and men are already paying state enterprise charges and taxes which can be horrendously greater than these charged to each different enterprise proprietor, together with the cigarette, alcohol and grownup industries.

And, to make issues worse, our Federal Tax Court has already denied deductions on every little thing from retailer hire to medical marijuana legally bought on the market to sufferers on this state-sanctioned business. The IRS does this by combining the Controlled Substances Act of 1970 classifying marijuana as a Schedule I drug along with IRS Code Section 280E disallowing the deduction of managed substance bills. This permits them to seize any revenue made by these small enterprise homeowners and drive them out of enterprise. Because of this, everybody within the medical marijuana business who turns in an trustworthy tax return turns into a sitting duck for anti-marijuana auditors.

Before these authentic businessmen and ladies can compete pretty each federal legal guidelines should be repealed. Until they’re, the state-legal medical marijuana business will probably be compelled to compete within the present tax world, a spot the place the IRS can wipe out all of their income at any time and the black market is definitely safer.

Because the U.S. Department of Health & Human Services owns patent #6630507 for the anti-oxidant properties in marijuana, and the U.S. patent workplace has granted marijuana patents to large pharmaceutical firms, it is apparent that marijuana has medicinal worth. Combined with the documentation of profitable medical use in Israel and different nations, it seems to be time for the 1970 Schedule I drug label’s repeal. But, that is not going to occur any time quickly except the medical marijuana business unites and calls for that change.

If growers, dispensary homeowners, medible makers and sufferers do not communicate up for this business at present, they’ll count on continued issues for years to come back. Medical marijuana sufferers and enterprise homeowners solely have two decisions; they’ll proceed to just accept discrimination for his or her alternative of a pure medication or they’ll come collectively as a gaggle and get these federal legal guidelines modified. If they select the primary possibility they may as effectively shut their doorways now as a result of taxes are going to drive them out of enterprise fairly fast anyway; but when they push for the equal rights that they deserve as an business it’ll open the door for authentic enterprise success and actual income.

Since each politician takes an oath to symbolize the voters in his or her state, and your state has repealed prohibition, it’s the politician’s job to get these federal legal guidelines modified. Medical marijuana enterprise homeowners must schedule conferences with their state senators and representatives to debate this downside at present. And, they need to count on outcomes. It is each voter’s proper to demand accountability, and state-authorized medical marijuana businessmen and ladies have the best to know what their elected officers have performed to finish this tax discrimination.

If the business waits too lengthy, it is apparent that the voters in medical marijuana states can have their rights overturned, large enterprise will probably be given management over the marijuana plant, poor individuals who have had success with medical marijuana will probably be compelled again onto harmful and addictive prescriptions, medical health insurance prices will skyrocket as everyone seems to be compelled to pay for Big Pharm’s artificial marijuana prescriptions for folks with insurance coverage, and prohibition in opposition to nature will proceed.

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