As if navigating the waters of cannabis legislation wasn’t agonizing enough, trying to meet cannabis tax compliance can take a lot of the fun (and profits) out of being in the industry. The complex laws that allow for the cultivation, sale, and ancillary services surrounding this beloved green plant are confusingly gray. For example, almost everyone running a business in the cannabis industry is familiar with the wildly unpopular 280E – a bill that prevents the deduction of expenses from income generated by the sale of cannabis. The only thing you can write off are things related to the Cost of Goods Sold (COGS). Thus, marijuana businesses are required to determine what expenses are included in COGS and, therefore, what expenses are deductible. What counts as a COGS? What doesn’t? It’s hard to say…
To date, very little guidance has been made available to help taxpayers make this determination. As a consequence, many individuals and businesses either end up too afraid to file their taxes and filings or rely on accountants or attorneys that aren’t familiar with compliance in the cannabis industry. This can, often times, end in major legal exposure and lost revenue. Filing cannabis related taxes appropriately can actually save companies money in the short and long term if they are properly advised.
Tax Defense Partners, a 50-employee company with roots in California, has a wealth of experience when it comes to cannabis tax compliance. They are rapidly positioning themselves as a leader in this dynamic and emerging industry. With an aspiration to educate, support, and grow cannabis businesses, Tax Defense Partners are already helping retailers, growers, delivery services, and other ancillary companies reach their full potential.
While they wish the government would revisit 280e, they remain determined to help owners of companies retain the highest profits based on these current IRS regulations.
Any and all companies in the cannabis industry setting themselves up to win long-term can only do so through proper compliance in their tax business strategy from day one. The team of CPAs and attorneys at Tax Defense Partners work with cannabis companies and individuals to minimize their tax obligations, resolve tax issues, and protect their bank accounts and income from IRS and state levies and liens.
Tax Defense Partners offers a free consultation on cannabis tax compliance. Make an appointment today at www.CannabisTaxRelief.com or give them a call at (800) 830-7777. Be sure to mention “WoahStork”.