But not recommend to blindly follow, cause the company considers the tax refund strategy to be “in large part specific to our position and our organization.”
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Most likely they found that certain costs they put into SG&A before could be considered COGS instead (and therefore deducted).
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I was told that the 280E was why there is no push for a federal tax.
Interesting. 280E is a federal tax on funds made from drug trafficking.
All of the federal legalization bills have included a replacement federal tax. Which people don’t like (because people don’t like taxes???) but which is in general substantially lower than the tax incurred under 280E depending on the type of cannabis business.
If cannabis is rescheduled to schedule III instead of schedule I - then the 280E federal tax rule goes away. I expect we’ll see quick movement to come up with a different way to tax cannabis after that. Losing around 40% of 70 billion in revenue generation (which is the estimated excess taxes paid due to 280E) seems like it might be a bit of a blow to the US Treasury. But probably its small potatoes.
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I wonder if they’re using this method
They could split everything up into business units to meet the gross receipts requirement, hard to say
The report states that certain qualifying cannabis taxpayers, who would otherwise be subject to business expenses being disallowed under Section 280E, could potentially account for their inventory under Section 471(c) using a method that would classify most or all of their expenditures as inventoriable costs and avoid Section 280E’s disallowance of such expenditures. Accordingly, as all the costs would be capitalized into inventory, they would then reduce taxable income as the inventory was sold. In other words, expenditures previously disallowed under Section 280E would be part of the cost of goods sold and allowed as a reduction of gross receipts.
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I don’t think so. I mean I guess if they were wholly separate entities… but that clause has a limit on how much revenue there is. Its like $25 mil or so.
So with getting that much back in taxes - their taxable “income” would have been more than $25 mil. Do you agree?
They might do it like la mota did in Oregon and have a separate LLC for every property🤷♂️
The payroll company a major chain in Colorado was made to avoid the 280E, but my mortgage broker wouldn’t give me a FHA loan because I worked in the Marijuana industry and got W2’s from them. Having to put 20% down on a conventional loan was not fun or fair. It isn’t like they paid well without the 280E, the Sr. MIP Manager position over around 100 employees I was offered paid $63k in 2021. Comparable jobs in the area not in the industry paid around 100k. Until marijuana is rescheduled, I don’t think anyone is going to be paid fairly.
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at least now you don’t gotta pay mortgage insurance
If no one accepts these positions business owners are forced to raise the pay. Why are people accepting weed positions if its lower pay and less benefits for similar work?
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You don’t need an education and you know how people think of educations in the weed industry……
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I don’t know about this anymore. Seems like corporate cannabis entities and even some smaller places are putting education on a pedestal and work experience in the backseat. This is just from my perspective, applying for jobs in the industry since my layoff.
Edit: but also agree that if you have a degree, why waste time working in this industry? If (and when) I have a degree I’m never looking at jobs in this industry again.
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Yeah I’ve seen this again and again in cannabis+hemp businesses of every size. The successful 20 year grower getting replaced by a guy with a master’s in plant science whose only real world experience is running a corn farm, etc
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I have a degree in chemistry and classics. Plus a black belt. Plus 15 years of pharma experiences. Plus 10 years of cannabis experience.
I 100% still choose to work in this industry. This industry needs us. It needs us to self regulate. It needs us to push innovation. It needs us to stand up for people who have no experience or no education or both. <3
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I’ve got a high school education and very little post secondary education, no degrees. I’m a c-level founding partner in a small, lean, efficient vertical organization (no retail) and I do alright. But I might be the exception. Don’t know if I could get what I am now if I hadn’t been with my crew for ~15 years
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It should be de-scheduled and regulated by the ATF and add a Cannabis division and regulated more like beer than ibuprofen.
I also think that there should be a schedule 2 ruling for Medical Cannabis I know that makes no sense but … If it’s medical it should be scheduled 2, if it’s medical with a high potential for abuse it should be scheduled 2
But because people also use it recreationally which I’m not against… It just makes it harder to be taken seriously as a medication.
Imho, Schedule 3 is half assing it.
But I guess if it’s regulated like ibuprofen it’ll at least be subject to rigourus testing forever. So that’s chill.
RIP my dog
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All of the COAs in the link the OP posted are over 0.3% in D9. And that wouldn’t make sense under the federal definition of hemp/etc. My guess is they just made a THCA product category so they can be included in search results for hemp THCA
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