Cannabis Law Group's Medical Marijuana Legal Blog
California Cannabis Business Tax Fight Over 280E Exemptions Continues
One of the largest California cannabis businesses is accusing the federal government of weaponizing federal tax law and wrongly interpreting the U.S. Constitution when it comes to taxation of the marijuana industry.
As our Los Angeles cannabis business tax lawyers can explain, this is the latest development in a long-running legal battle over the much-derided IRS rule outlined in 280E, which curbs the deduction cannabis companies can take on their taxes.
Dispensary chain Harborside in Oakland is appealing in the U.S. Court of Appeals for the Ninth Circuit following a 2019 ruling by a U.S. Tax Court which ordered the company to pay $11 million in back taxes after wrongly claiming a host of business deductions. Such deductions are available to most businesses in the U.S., but cannabis companies don’t have that luxury, thanks to 280E. Continue reading