For anyone left wondering whether medical marijuana purchases are deductible on your federal taxes, the answer is no.<\/p>\n
But there was some confusion about the tax option after Internal Revenue Service (IRS) National Taxpayer Advocate Erin Collins was asked about the issue during an interview with C-SPAN\u2019s Washington Journal on Thursday.<\/p>\n
A Nevada-based caller asked Collins why he couldn\u2019t find an option on the tax service website TurboTax to deduct cannabis purchases, which are legal under state law but not federally. The official responded that she\u2019d \u201cplead ignorance on the marijuana\u201d question, \u201cunless you\u2019re saying it\u2019s a medical deduction.\u201d<\/p>\n
\u201cIf it is a medical expense, and then you have an option on your Schedule A, you could potentially put it there,\u201d she said.<\/p>\n
Marijuana is legal for medical and recreational purposes in Nevada, and the caller didn\u2019t specify whether he was a registered patient. But federal law is clear, and while Collins\u2014who was appointed to her role by Trump administration Treasury Secretary Steven Mnuchin in 2020\u2014said there was \u201cpotentially\u201d an opportunity to claim deductions if it was medical marijuana he was purchasing, she clarified in a statement to Marijuana Moment on Friday that that was not the case.<\/p>\n
\u201cWhile answering viewer calls on C-SPAN Washington Journal yesterday, one viewer asked about the deductibility of marijuana purchases he had made,\u201d she said. \u201cI had not previously studied the federal tax treatment of marijuana, and I speculated that marijuana might \u2018potentially\u2019 be deductible as a medical expense in certain circumstances. After the program, I checked the law. To clarify, medical marijuana is not tax deductible for federal purposes under current rules.\u201d<\/p>\n
IRS, which falls under the Treasury Department, says it doesn\u2019t have discretionary authority to adopt policies that permit marijuana-related deductions while cannabis remains illegal under federal law. But the agency has taken steps to clarify tax policy for state-legal marijuana businesses.<\/p>\n
De Lon Harris, commissioner of examination at the IRS Small Business\/Self Employed (SB\/SE) Division, recently spoke about tax-related issues in state-legal marijuana markets in a webinar hosted by PBC Conference. He said that while cannabis remains federally illegal, businesses that deal in the controlled substance must still file federal taxes, and IRS is here to help<\/a>.<\/p>\n Harris also provided\u00a0tips for marijuana businesses on tax compliance<\/a>\u00a0in a blog post published in September. And IRS separately hosted a forum in August\u00a0dedicated to tax policy for marijuana businesses<\/a>\u00a0and cryptocurrency.<\/p>\n Another top IRS official who\u2019s since left the agency also\u00a0participated in a PBC Conference webinar<\/a> in 2020. He offered similar recommendations to cannabis businesses, while also recognizing that the legalization movement will potentially succeed in ending prohibition in \u201call states.\u201d<\/p>\n Current Treasury Secretary Janet Yellen said late last year that freeing up banks to work with state-legal marijuana businesses would \u201cof course\u201d make the IRS job of collecting taxes easier<\/a>.<\/p>\n Mnuchin, during the Trump administration, repeatedly addressed the issue<\/a>, saying the current policy conflict creates \u201csignificant problems\u201d for IRS and financial regulators. It \u201ccreates significant risk in the communities for collecting this amount of cash. It\u2019s problematic,\u201d he said last year.<\/p>\n At a separate PBC Conference event in September, former National Credit Union Administration Chairman Rodney Hood\u00a0criticized Congress for failing to advance marijuana reform<\/a>\u00a0and talked about the need for federal financial regulators to take a \u201cprinciples-based approach to cannabis banking\u201d and \u201cdeliver a preliminary regulatory framework that we can share with other regulators and members of Congress who share our concern about addressing these problems.\u201d<\/p>\n Hood also recently said that marijuana legalization is not a question of \u201cif\u201d but \u201cwhen,\u201d and he\u2019s again offering advice on how to navigate the federal-state conflict<\/a>\u00a0that has left many banks reluctant to work with cannabis businesses.<\/p>\n House Marijuana Banking Bill Sponsor Is \u2018Confident\u2019 It Will Advance Through Senate Despite Obstacles<\/a><\/p>\n<\/blockquote>\n\n The post IRS Official Clarifies That Medical Marijuana Is Not Tax-Deductible Under Federal Law After Misstatement<\/a> appeared first on Marijuana Moment<\/a>.<\/p>\n
For anyone left wondering whether medical marijuana purchases are deductible on your federal taxes, the answer is no. But there was some confusion about the tax option after Internal Revenue Service (IRS) National Taxpayer Advocate Erin Collins was asked about the issue during an interview with C-SPAN\u2019s Washington Journal onContinue Reading<\/a><\/span><\/p>\n","protected":false},"author":458,"featured_media":0,"comment_status":"false","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[18,81,126],"tags":[],"_links":{"self":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/52913"}],"collection":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/users\/458"}],"replies":[{"embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/comments?post=52913"}],"version-history":[{"count":1,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/52913\/revisions"}],"predecessor-version":[{"id":52914,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/52913\/revisions\/52914"}],"wp:attachment":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/media?parent=52913"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/categories?post=52913"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/tags?post=52913"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n
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\nRead More: IRS Official Clarifies That Medical Marijuana Is Not Tax-Deductible Under Federal Law After Misstatement<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"