Entries by Tax Attorney

U.S. Tax Court Deals Another Blow To The Cannabis Industry

The Federal Controlled Substances Act (“CSA”) 21 U.S.C. § 812 classifies marijuana as a Schedule 1 substance with a high potential for abuse, no currently accepted medical use in treatment, and lack of accepted safety for use under medical supervision. Generally, businesses can deduct ordinary and necessary business expenses under I.R.C. §162. This includes wages, rent, supplies, etc. […]

Harborside Finally Gets A Win In U.S. Tax Court Getting Tax Penalties Abated

Having been beaten in an opinion issued by the U.S. Tax Court just weeks before where the Court ruled that IRC Section 280E does apply to Harborside (Click here for the Court’s opinion: Patients Mutual Assistance Collective Corp., dba Harborside Health Center v. Commissioner of Internal Revenue, 151 T.C. 11) which Harborside can appeal to […]

President Trump Signs 2018 Farm Bill Legalizing Hemp, Will Cannabis Follow?

Every five years, Congress passes legislation that sets national agriculture, nutrition, conservation, and forestry policy, commonly referred to as the “Farm Bill”. On December 20, 2018 President Donald Trump signed legislation into law that includes language lifting the United States’ decades-long prohibition on domestic, commercial hemp and hemp-derived products. The provisions were included within The […]

West Hollywood Approves Cannabis Cafes And Consumption Lounges To Open In 2019.

And you know that the IRS will surely be interested in auditing these businesses! After spending more than seven months screening over 300 applicants, the city of West Hollywood, California released the names of businesses approved to have actual eateries, lounges, and cafes that allow smoking, vaping, and/or munching on edibles and weed-infused food. There […]

Final Regulations Out In California: Will California’s Section 5032 Disrupt the Cannabis Market?

On December 7, 2018, California’s three cannabis licensing authorities submitted final versions of the state cannabis regulations to be approved by January 16, 2019. A major change in the regulations comes from § 5032 Commercial Cannabis Activity. This section reads as follows: All commercial cannabis activity shall be conducted between licensees. Licensed retailers and licensed […]