For cannabis business owners, tax season can create extra headaches and stress, due primarily to Section 280E of the Internal Revenue Code. The ways that this tax affects cannabis businesses is drastically different than its impact on their non-cannabis counterparts.
Check out our 280E tax guide, where we explore cannabis tax topics:
The difference of the tax rates on cannabis and non-cannabis businesses
Which business structure will help you have the best overall tax return
The importance of non-tax season
Accounting integrations for your seed-to-sale
Fill out the form to download the guide and get a jump start on your next tax season!
Section 280E forbids businesses from deducting otherwise ordinary business expenses from gross income associated with the “trafficking” of Schedule I or II substances, as defined by the Controlled Substances Act. As cannabis is still considered a Schedule I substance, Section 280E applies to all state-legal cannabis businesses.
Understanding the 280E tax is crucial for any cannabis business looking for the best tax return possible. By structuring your business correctly, taking advantage of non-tax season to adequately prepare, and relying on software best designed to aid in monitoring important transactions, you can make the most of your return—even with the restrictions that the 280E tax imposes on cannabis businesses.
Download our Section 280E Cannabis Tax Guide to learn how to maximize your tax season and ensure financial compliance.