LEX CANNA

The Blurred Line between IRS Tax Collection and Federal Drug Laws

As California prepares for state-legal cannabis sales to begin, expectations of a robust, highly profitable market are rampant. But looming legal issues may cramp such sky-high expectations. Heavy tax burdens, for example, may strain profitability. Here we discuss Internal Revenue Code section 280E, which has a major potential effect on cannabis companies’ federal tax burden. […]