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The New York Senate has approved a bill that would provide tax relief to New York City marijuana businesses that are currently blocked from making federal deductions under an Internal Revenue Service (IRS) code known as 280E.<\/p>\n
While Gov. Kathy Hochul (D) signed a budget bill last year that included provisions allow state-level cannabis business tax deductions<\/a>\u2014a partial remedy to the ongoing federal issue\u2014New York City has its own tax laws that weren\u2019t affected by that change.<\/p>\n Now the Senate has passed legislation from Sen. Luis R. Sep\u00falveda (D) to fill that policy gap, voting 43-18 on Monday to send the local reform fix to the Assembly for consideration.<\/p>\n \u201cThis bill would allow a deduction for business expenses, incurred by taxpayers authorized by the Cannabis Law to engage in the sale, distribution, or production of adult-use cannabis products or medical cannabis, for purposes of the unincorporated business tax (UBT), the general corporation tax (GCT), and the corporate tax of 2015, commonly referred to as the business corporation tax (BCT),\u201d a summary says.<\/p>\n A section of the city\u2019s tax code would be amended<\/a> to add sections allowing the deductions \u201cin an amount equal to any federal deduction disallowed by section 280E of the internal revenue code.\u201d<\/p>\n \u201cThis modification to income is appropriate because, while the expenses of cannabis-related business cannot be deducted for federal purposes, New York law permits and encourages these businesses akin to any other legitimate business occurring in the State,\u201d a memo attached to the bill says. \u201cThe City\u2019s business taxes should similarly encourage these business activities.\u201d<\/p>\n It also notes that the reform legislation has the support of New York City Mayor Eric Adams (D).<\/p>\n \u2014 Lawmakers in several states have pursued the tax workaround as congressional marijuana reform legislation continues to stall, leaving state-licensed cannabis businesses with significantly higher federal effective tax rates under prohibition.<\/p>\n For example, the Illinois legislature recently approved a budget bill<\/a> that includes similar provisions to allow licensed marijuana businesses to take state tax deductions that they\u2019re currently prohibited from utilizing at the federal level. That measure has been sent to the governor\u2019s desk.<\/p>\n In April, the governor of New Jersey signed legislation<\/a>\u00a0to allow licensed marijuana businesses to\u00a0deduct certain expenses on their state tax returns as a partial IRS 280E workaround.<\/p>\n Lawmakers in\u00a0Iowa<\/a>,\u00a0New York<\/a>,\u00a0Pennsylvania<\/a>\u00a0and\u00a0Virginia<\/a>\u00a0have similarly pursued tax relief for each of their state\u2019s marijuana markets.<\/p>\n At the congressional level, Rep. Earl Blumenauer (D-OR) reintroduced\u00a0a bill in April that would amend the IRS code<\/a>\u00a0to allow state-legal marijuana businesses to finally take federal tax deductions that are available to companies in other industries.<\/p>\n The congressman told Marijuana Moment that he believes the reform would ultimately generate additional tax dollars<\/a>, as the existing code acts as a disincentive for marijuana businesses to report taxes honestly.<\/p>\n Also, a newly formed cannabis coalition that launched on Tuesday is advocating for marijuana rescheduling or descheduling<\/a>. If cannabis is placed in Schedule III, IV or V, that would place the industry outside of the parameters of the 280E ban, the group pointed out.<\/p>\n For the time being, the marijuana industry continues to face tax policy challenges under the umbrella of prohibition. And as\u00a0the Congressional Research Service (CRS) noted<\/a>\u00a0in a 2021 report, IRS \u201chas offered little tax guidance about the application of Section 280E.\u201d<\/p>\n Back in New York, state regulators are moving to allow cultivators to sell cannabis to consumers at farmers market-style events<\/a>.<\/p>\n New Congressional Bill Would Authorize $150 Million In Funds To Universities To Study Marijuana Obtained From State Agencies<\/a><\/p>\n<\/blockquote>\n\n The post New York Senate Passes Bill To Let Marijuana Businesses In New York City Take Local Tax Deductions Prohibited Under Federal Law<\/a> appeared first on Marijuana Moment<\/a>.<\/p>\n
The New York Senate has approved a bill that would provide tax relief to New York City marijuana businesses that are currently blocked from making federal deductions under an Internal Revenue Service (IRS) code known as 280E. While Gov. Kathy Hochul (D) signed a budget bill last year that includedContinue Reading<\/a><\/span><\/p>\n","protected":false},"author":458,"featured_media":65739,"comment_status":"false","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[18,81],"tags":[],"_links":{"self":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/65738"}],"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=65738"}],"version-history":[{"count":1,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/65738\/revisions"}],"predecessor-version":[{"id":65740,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/posts\/65738\/revisions\/65740"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/media\/65739"}],"wp:attachment":[{"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/media?parent=65738"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/categories?post=65738"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cannabiscultivatornews.com\/home\/index.php\/wp-json\/wp\/v2\/tags?post=65738"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\nRead More: New York Senate Passes Bill To Let Marijuana Businesses In New York City Take Local Tax Deductions Prohibited Under Federal Law<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"