IRS Greenlights Tax Loophole for Pot Businesses
The IRS has updated its guidance for cannabis operators, a move some in the industry view as a rare helping hand from the tax agency.
The revised guidance, published Sept. 12, maintains that state-legal marijuana businesses do not qualify for most common business deductions and credits, per Internal Revenue Code Section 280E. But, the IRS now points out, those businesses can reduce gross receipts using an accounting method available under Section 471.
Section 280E, which the industry despises, puts strict limits on which taxes cannabis businesses can deduct, forcing them to pay a far . . .
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