Cannabis-growing businesses face many challenges when it comes to their finances. Not only are the relevant tax laws much more complex than in other industries, but also there’s the extensive range of accounting and bookkeeping practices they have to follow to ensure compliance. Fortunately, Cannabis CPA is here to provide a full suite of tax and financial solutions for growers. We understand the conditions faced by the industry, and our extensive network of experts gives us the consulting capabilities to help even the largest growing operations manage their obligations.
Tax And Financial Solutions For Growers
Financial Expertise for Cannabis Growing Operations
Financial Planning Built for Growers
Understanding Tax Code § 280E
Because cannabis is considered a Schedule I controlled substance under federal law, companies that buy or sell it in states where medicinal or recreational use is legal face restrictions. Tax Code § 280E prohibits “ordinary” business deductions for these entities, which means the cannabis industry currently pays a much higher effective tax rate.
Complicating matters further is the fact that cannabis growing operations can deduct the cost of goods sold, and some of these cannot be deducted at the federal level even if they are allowed at the state level. Our expertise when it comes to untangling Tax Code § 280E for growers means we can reduce our clients’ tax liability as much as possible.
Our Services for Cannabis Growers
We work to help our clients:
- Establish their corporate structure to optimize their tax situation
- Understand what is and is not deductible under COGS
- Implement a system for recording hours worked directly in production
- Deduct the portion of their labor costs not directly involved in production
- Separate their direct and indirect expenses for tax purposes
- Maintain compliance with all the necessary rules and regulations
Why Choose Cannabis CPA?
With the professionals at Cannabis CPA working for you, it’s like having your own dedicated CFO on an outsourced basis. Our grower accounting services and other capabilities are rooted in years of industry-specific experience, helping clients determine what they can deduct and understanding how to file their taxes. When you choose to work with us, you can rest assured we will fill multiple roles, keeping you compliant with tax regulations and establishing your corporate structure in the most appropriate manner. We also assist with reporting systems and bookkeeping services for growers. If you’re ready to learn more, just reach out and speak with one of our representatives today.