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

We have all heard the old proverb “if it’s too good to be true, then it probably is.” In the tax world, this proverb might as well be referred to as the economic substance doctrine. Generally, taxpayers are free to structure their business transactions in a manner of their choosing. However, the economic substance doctrine

Seal_of_the_United_States_Tax_Court_svgOn January 30, 2017, Judge Goeke of the United States Tax Court issued an opinion rejecting a taxpayer’s asserted reasonable cause defense for failure to file Forms 5471, which are entitled “Information Return of U.S. Persons With Respect to Certain Foreign Corporations.” See Flume v. Commissioner, T.C. Memo. 2017-21. At issue in the case