Jordan S. Zoot - CPA
California Repeals 280E for Personal Income Tax – Existing law, the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), among other things, consolidates the licensure and regulation of commercial medicinal and adult-use cannabis activities and authorizes persons to conduct specified commercial cannabis activities, as defined, in the state.
The California Dept. of Tax and Fee Administration [“CDTFA”] just issued a set of regulations that apply to the “Marketplace Facilitator Act”. This new law which has been unnoticed by most in California’s cannabis industry could be applied to Weedmaps and others who facilitate sales of cannabis to California residents.
We don’t have experiences that impress or “WOW” us very often. Perhaps we have become jaded. However, we had one today, and are still attempting to digest it. We spend most of our time working in the commercial cannabis industry in California – complaints about the complexity of licensing, tax reporting and regulatory compliance are constant. The implementation of the METRC compliance system in California became a running joke with single and double digit usage out of thousands of licensees.
CA AG’s Office Press Release February 2019. “Friday, February 22, 2019 .California Attorney General Xavier Becerra and Assembly woman Lorena Gonzalez (D-San Diego) today at the Port of San Diego unveiled legislation to substantially strengthen the state’s efforts to combat the illegal underground economy in California that targets the most vulnerable members of our community. Assembly Bill 1296 will expand California’s unique, multi-agency task force of law enforcement professionals known as the Tax Recovery and Underground Economy (TRUE) Team that currently operates out of Sacramento and Los Angeles.”
Un Pesce Marcisce Dalla sua Testa is an old Sicilian proverb that translates “a fish rots from its head”. The statement appears to be an accurate summary of present condition of both the private and governmental sides of California’s cannabis industry.
Who Is Inept: “NCIA does not appear in the registry of tax-exempt organizations maintained by the Office of the Attorney General very likely because NCIA has not registered to engage in business in California”
Who is Inept? – We were surprised a few days ago when we discovered California Cannabis Industry Association (“CCIA”) has been suspended by the Franchise Tax Board (“FTB”). At the moment CCIA lacks the authority to engage in business. We stumbled across this information quite inadvertently. We were checking to see if the National Cannabis Industry Association (“NCIA”) was authorized to engage in business in California as a foreign corporation.
Farmers across the country have started growing hemp under the 2014 farm bill while the regulations for the 2018 farm bill are sorted out by the USDA and state departments of agriculture. Many have setup legal entities and registered under their states’ regulatory programs as permitted growers but have hit a hurdle that most new businesses hop right over: opening a bank account.
Coming Soon Our Newest Columnist, Shane Eloe, Senior Accountant, Dickinson & Clark CPAs, PC Council Bluffs, Iowa
Here’s an interview he did with CPA Practice Advisor in February. We look forward to having him onboard