Ganjapreneurs Forced To Pay More Taxes

August 15, 2012

 

The I.R.S. is a force to be reckoned with.  Dealing with the them is one of the most treaded and daunting tasks.  Anything to do with taxes is never fun.  Many feel that the I.R.S. is unfair and everyone is unhappy about the amount of taxes they pay.  Business owners look in every nook and cranny to find any possible deductions that can be used at tax time, but what if those deductions weren’t extended to a business because of the nature of that business.  

 

Well, the U.S. Tax Court has ruled that marijuana businesses could not claim business expense deductions.  In 2007, the court ruled that expenses directly related to “care giving” could be claimed but not any other type of expense.  Businesses in general can write-off rent, utilities, office supplies and just about any other expense to operate the business.

 

The ruling made it clear that cannabis businesses needed to keep solid records about their sales and their “care giving” services.  The problem with that is that they could face severe penalties from the federal government and tax records could be used against them in  federal court.  This really is a catch 22 situation for the owners of these businesses.  

 

Seems to me this would be just another reason to make someone keep an undercover operation, not have to worry about paying any taxes if they have the same risks from the federal government if they are found to be in possession of marijuana anyway.  There are so many ways the government could turn these businesses into profit for the economy if they would stop wasting money on current enforcement laws.  Do you think cannabis businesses should be allowed the same expense allowances as other business?  How do you think the government could benefit from legalizing marijuana being fair to these types of businesses?

 

 

http://news.yahoo.com/ganjapreneur-loses-u-tax-court-over-marijuana-business-153643575--sector.html?_esi=1