Heading into the new year, California cannabis company tax compliance and banking will continue to be challenged. Marijuana retailers, growers, product makers and others in the industry would be wise to work closely with an experienced Los Angeles cannabis business attorney to help them navigate these ongoing difficulties. Recently, the Internal Revenue Service (IRS) issued tips for cannabis compliance. The federal agency noted that while it’s outside of the agency’s power to resolve many of the unique business predicaments that arise from federal prohibition, it wants to help support cannabis companies in becoming tax compliant. Even though marijuana continues to be classified as a Schedule I narcotic by federal authorities, these businesses are still required to shell out federal taxes. In September, the agency released tips for tax compliance for cannabis businesses. Among those: Know your investors. Thousands of people are fighting to get into the industry, but working with investors may have some tax implications and repercussions for cannabis companies. Unregistered and “silent” financing and ownership arrangements, with investors, sometimes being referred to as “beneficial owners,” get the benefits of ownership but avoid having the property title or activity in their name.
Cannabis Law Group’s Medical Marijuana Legal Blog, 12/29/2021 15:25:00