In recent years there has been an uptick in state legalization of cannabis for recreational purposes, with states gaining millions and in some cases billions in tax revenue from the sale of cannabis.
Despite cannabis sales still being illegal at the federal level, the income from illegal cannabis sales is reportable for federal income tax purposes. There are various intricacies that come into play with these taxation rules. These same intricacies exist at the state level.
This course explores the various tax implications of cannabis sales and also explores some of the controversies regarding expense deductions.
After completing this course, you will be able to:
- Understand the federal government’s treatment of cannabis as an illegal controlled substance
- Specify how a cannabis business must report income and expenses related to cannabis sales for federal income tax purposes
- Identify the different methods states use to tax cannabis sales, and
- Specify state trends relating to deductibility of cannabis-related expenses for income tax purposes
