{"id":49485,"date":"2021-08-18T12:53:35","date_gmt":"2021-08-18T20:53:35","guid":{"rendered":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/2021\/08\/18\/irs-hosts-marijuana-and-cryptocurrency-tax-event-that-highlights-legalization-support\/"},"modified":"2021-08-18T13:45:56","modified_gmt":"2021-08-18T21:45:56","slug":"irs-hosts-marijuana-and-cryptocurrency-tax-event-that-highlights-legalization-support","status":"publish","type":"post","link":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/2021\/08\/18\/irs-hosts-marijuana-and-cryptocurrency-tax-event-that-highlights-legalization-support\/","title":{"rendered":"IRS Hosts Marijuana And Cryptocurrency Tax Event That Highlights Legalization Support"},"content":{"rendered":"

<\/p>\n

The Internal Revenue Service (IRS) on Wednesday hosted a forum dedicated to tax policy for marijuana businesses and cryptocurrency.<\/p>\n

The seminar, which was presented by a representative of the National Association of Tax Professionals (NATP), examined issues such as allowable tax deductions while cannabis remains federally illegal and how different states approach taxing marijuana. It also covered issues related to paying taxes on earnings in Bitcoin and other forms of digital currency.<\/p>\n

During the IRS Nationwide Tax Forum panel, there was also discussion about the growing public support for cannabis legalization and the prospects of federal reform.<\/p>\n

\n

#TaxPros<\/a>, it\u2019s Week 5 of the 2021 #IRS<\/a> Nationwide Tax Forum. See this week\u2019s schedule for Virtual Currency, Cannabis, and Compliance Reporting and more: https:\/\/t.co\/Ex9h8RuLra<\/a> #IRSTaxForum<\/a> pic.twitter.com\/Wu6puGyB1q<\/a><\/p>\n

\u2014 IRS Tax Pros (@IRStaxpros) August 16, 2021<\/a><\/p>\n<\/blockquote>\n

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A description<\/a> of the event states that attendees would learn how to \u201cprepare a tax return for illegal activities\u201d and \u201cidentify when virtual currency needs to be reported as taxable income.\u201d<\/p>\n

The presentation, which was aimed at tax professionals interested in learning about the crypto and cannabis spaces, provided a high-level overview of some of the financial issues that are unique to the marijuana industry under the umbrella of federal prohibition.<\/p>\n

While the vast majority of states have legalized cannabis in some form, its illicit status under the Controlled Substances Act means that marijuana businesses can not deduct standard expenses like in other traditional markets under a provision known as 280E, the presenter explained.<\/p>\n

He emphasized, however, that even if the business activity is considered illegal, cannabis companies must still pay federal taxes. And he pointed out that there is an opportunity for limited deductions when it comes to reporting the cost of goods for retailers and producers.<\/p>\n

One slide from the federally hosted presentation noted polling that shows a majority of Americans support ending prohibition<\/a>, and it also provided an overview of the economic potential of the marijuana market.<\/p>\n

\"\"<\/p>\n

Via IRS\/NATP.<\/p>\n<\/div>\n

The accountant who led the NATP panel further discussed efforts by Senate Majority Leader Chuck Schumer (D-NY) and colleagues to pass legalization legislation, a draft version of which was released last month<\/a>.<\/p>\n

\u201cI think this is a very active item\u2014and in doing so, I believe that is becoming more and more mainstream,\u201d he said. \u201cRight now, if we get legislation to regulate\u2014the question is if they\u2019re going to legalize it\u2014then my presentation next year will be very different.\u201d<\/p>\n

While IRS hasn\u2019t advocated for a federal cannabis policy change, it has stood out as an agency that understands the complications created by prohibition\u2014and it\u2019s taken steps to provide clarity to taxpayers and financial professionals to navigate the space.<\/p>\n

Earlier this year, IRS Commissioner Charles Rettig told Congress that the agency would \u201cprefer\u201d<\/a> for state-legal marijuana businesses to be able to pay taxes electronically, as the current largely cash-based system under federal cannabis prohibition is onerous and presents risks to workers.<\/p>\n

Former Treasury Secretary Steven Mnuchin said in 2019 that he\u2019d like to see Congress approve legislation resolving the cannabis banking issue and he pointed to the fact that\u00a0IRS has had to build \u201ccash rooms\u201d to deposit taxes<\/a>\u00a0from those businesses as an example of the problem.<\/p>\n

IRS released\u00a0updated guidance on tax policy for the marijuana industry<\/a>\u00a0last year, including instructions on how cannabis businesses that don\u2019t have access to bank accounts can pay their tax bills using large amounts of cash.<\/p>\n

The update appears to be responsive to a Treasury Department internal watchdog report<\/a> that was released last year. The department\u2019s inspector general for tax administration had criticized IRS for failing to adequately advise taxpayers in the marijuana industry about compliance with federal tax laws. And it directed the agency to \u201cdevelop and publicize guidance specific to the marijuana industry.\u201d<\/p>\n

The IRS\u2019s commissioner of the Small Business\/Self Employed Division participated in a cannabis-focused event in December in which he\u00a0noted the legalization movement\u2019s continued momentum<\/a>, saying that it will potentially succeed in ending prohibition in \u201call states.\u201d<\/p>\n

View the IRS\/NATP presentation on marijuana and cryptocurrency below:\u00a0<\/strong><\/p>\n

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Virtual Currency Cannabis a\u2026<\/a> by Marijuana Moment<\/a><\/p>\n

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North Carolina Senators Act On Revised Medical Marijuana Legalization Bill In Committee<\/a><\/p>\n<\/blockquote>\n

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The post IRS Hosts Marijuana And Cryptocurrency Tax Event That Highlights Legalization Support<\/a> appeared first on Marijuana Moment<\/a>.<\/p>\n


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