Section 280E and The Marijuana Industry
Section 280E & the Marijuana Industry: This presentation was originally presented at the Small Firm Practitioners Conference, hosted by the Michigan Association of CPAs on August 14, 2019. Learn about the application of Internal Revenue Code §280E for marijuana businesses and how costing for inventories under §471 effects producers and resellers. Download the presentation in PDF format: 280E Presentation.
In this presentation we discuss:
-Internal Revenue Code Section 280E
-Internal Revenue Code Section 471
-Inventories at cost for producers vs resellers
-Other industry accounting considerations, including the need for a specialized chart of accounts and also advanced record keeping
-Additional marijuana accounting resources
This webinar presentation provides useful and relevant information to serve as a guideline for those providing services to marijuana businesses. The information presented is specific to the marijuana industry. Marijuana businesses must adhere to restrictions in internal revenue code section 280E when computing their federal taxable income. §280E disallows all expense deductions for marijuana businesses for federal income tax purposes. However, marijuana businesses operating compliantly under state laws may deduct their cost of goods sold when computing taxable income. Cost of goods, or allowable inventory costs, differ between producers, resellers, and also services providers.
LC Solutions Michigan PLLC is a leading CPA firm providing services to the cannabis industry. While we put our focus on servicing clients operating under the Michigan MMFLA, MRTMA and MMMA, we also offer services nation wide. LC Solutions Michigan PLLC has helped hundreds of clients navigate their way through the complexities of accounting for their cannabis business.
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Copyright by LC Solutions Michigan PLLC
August 14, 2019
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