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A new bill (H.R.
1118) was introduced in congress that will amend the
Internal Revenue Code of 1986 to allow deductions and
credits relating to expenditures in connection with
marijuana sales conducted in compliance with State law.
Currently Section 280E of the Internal Revenue Code of 1986
states that “No deduction or credit shall be allowed for any
amount paid or incurred during the taxable year in carrying
on any trade or business if such trade or business (or the
activities which comprise such trade or business) consists
of trafficking in controlled substances (within the meaning
of schedule I and II of the Controlled Substances Act) which
is prohibited by Federal law or the law of any State in
which such trade or business is conducted.
Hence, H.R. 1118 was introduced to change that to treat
marijuana businesses like all other businesses with regard
to deductions and credits.
This will positively impact the growing marijuana
industry that is also creating jobs.
According to Leafly as of 2018 the legal marijuana industry
was worth $10.4 billion.
The estimated number of people employed by the
marijuana industry was 250,000.
A quarter-million of those jobs were devoted just to
the handling of marijuana plants.
So far thirty three (33) states have legalized
medical marijuana use, with six (6) more considering it in
2019.
Sources:
H.R. 1118
Section 280E of the Internal Revenue Code of 1986
Leafly
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