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Interesting New Tax Court Decision on Section 280E

Jan. 23, 2019—[Updated 1/24/19 to elaborate a bit on my two observations] Happy (belated) new year! Back in late November 2018, the United States Tax Court issued a noteworthy decision in a tax proceeding against Harborside Health Center, one of the nation’s largest (if not THE) largest state licensed marijuana suppliers. The full decision in Patients Mutual...

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How to Lure Consumers Away from the Marijuana Black Market

Oct. 5, 2018—[Updated 10/8 8:44 am to add more information.] Even in states that have legalized the commercial supply of marijuana, some lawful consumers continue to purchase marijuana from the black market. Those black market sales pose several problems for state regulators; among other things, for example, they (likely) don’t generate any marijuana tax revenues for the...

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The Corporate Tax Cut Might Have Done More for Marijuana Suppliers than Repealing Section 280E Would Have

Feb. 16, 2018—As most readers will know, state licensed marijuana businesses pay a comparatively high effective federal tax rate, because a special provision of the federal tax code (section 280E) bars them from deducting all but their cost of goods sold (COGS) when calculating their federal tax liability. In other words, these businesses may not deduct their...

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