August 6, 2011280E, 280E issues, TAXES208E, 280E issues, accounting for collectives, accounting for dispensaries, accounting for dispensary business, accounting for marijuana business, Accounting Issues in the cannabis industry, California taxes, cannabis business accounting, collective taxes, dispensary accounting, dispensary taxes, FEDERAL TAXES, Income Taxes, IRS, marijuana business accounting, ounting for dispensaries, paying taxes, sales taxes, taxation, taxesby George
Tax attorney - Robert W. Woods, states: "Sales tax isn’t the only issue. As I noted here, the IRS also has issues with medical marijuana. Under federal tax law, Internal Revenue Code Section 280E precludes deductions for any business trafficking in controlled substances. For that reason, some dispensaries have been stuck paying tax on their gross income, not on their net after expenses!
Jan 2011 - Arizona | Attorney General Tom Horne is using a loophole in Prop 203 (the medicalmarijuana law that voters passed in 2010) on which to base his sales tax ruling. The law says would-be medical marijuana patients can get a “doctors’ recommendation” for the drug– not a prescription. Prescriptions are not taxable; doctors’ recommendations are. (This is like saying your doctor recommended aspirin or multi-vitamins; when you go to buy the aspirin or multi-vitamins, they are subject to sales tax.)