I have written before about the battles being fought by cannabis businesses facing IRS examinations.  IRS audits raise many issues for state legal cannabis businesses operating in violation of the Controlled Substances Act. In some situations, taxpayers have struggled to resolve IRS examinations while addressing concerns that incriminating evidence provided to the IRS could fall

Yesterday the Tax Court issued two decisions discussing the impact of Section 280E on cannabis businesses.  One of these cases addresses the application of Section 280E to licensed and non-licensed entities.  Both cases address the application of penalties to cannabis businesses.

Alternative Health Care Advocates v. Comm’r

This case involves a California dispensary, Alternative Healthcare

In the latest Tax Court opinion addressing the application of Section 280E to cannabis businesses there is no good news.  However, there is some new guidance.  In Patients Mutual Assistance Collective Corp. v. Comm’r, 151 T.C. No. 11, the taxpayer made a litany of arguments to convince the court that their business, or

Our colleague Joseph A. McNelis III has written an excellent article for the In the Weeds blog about a recent statement from the U.S. Attorney in Massachusetts regarding his office’s enforcement priorities surrounding recreational marijuana.  In his statement, U.S. Attorney Andrew Lelling noted that while he cannot “immunize the residents of the Commonwealth from federal

I have recently penned a Law360 article discussing lessons learned from recent tax decisions impacting cannabis businesses.  We will continue to cover this topic on this blog.

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There is not too much to say about the Tax Court’s latest decision involving a marijuana company.  In Loughman v. Commissioner, T.C. Memo 2018-85, the operators of a Colorado marijuana dispensary argued that for a marijuana dispensary operating as an S corporation, Section 280E discriminates against S corporation shareholders by double taxing income when

Attorneys representing cannabis businesses are often faced with questions about what happens when the cannabis business has not paid its taxes and the IRS is proceeding with collection actions.  No one thinks the IRS will seize and sell cannabis to satisfy tax liabilities, because in doing so the IRS would engage in criminal violations of

Our colleagues Joseph A. McNelis III and William Bogot have published a client alert addressing yesterday’s announcement by Attorney General Jeff Sessions that effectively ends the Obama Administration’s “hands off” approach to licensed cannabis operations in states where cannabis has been legalized for medicinal or recreational purposes. This announcement is important for all licensed cannabis

Today, the Tax Court issued its opinion in Feinberg v. Commissioner, a case involving an ongoing and hard fought battle between the IRS and a medical marijuana dispensary, Total Health Concepts, LLC.  The IRS examined THC’s 2009 through 2011 tax returns.  As a result of the examination, the IRS adjusted the member taxpayers’ returns