Here is a motto worth remembering: The business of cannabis is … business. And, as with any other enterprise, planning matters, implementation matters, safeguards matter.
In a noteworthy decision, the United States Tax Court recently denied income tax deductions claimed by the operators of a medical marijuana dispensary. In Gibson v. Commissioner of Internal Revenue, the United States Tax Court ruled that taxpayers running a medical marijuana dispensary could not deduct those ordinary and necessary business expenses normally associated with the operation of a business. Furthermore, the court ruled that bad record keeping precluded the taxpayers from taking full advantage of allowances associated with the cost of goods sold.
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