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Hoped-for guidance for cannabis companies affected by Section 280E of the federal tax code won’t be published anytime soon, an IRS attorney said recently.
According to Bloomberg Tax, the federal agency is more focused on coronavirus-relief issues and guidance related to the 2017 tax reforms pushed through Congress by Republicans and signed into law by former President Donald Trump, IRS attorney Evan Hewitt said during an online conference hosted by the American Bar Association’s Tax Section.
The Original article is at Bloomberg
IRS Marijuana Rules Overshadowed by Covid Relief, 2017 Tax Law
Guidance for a brief section of the tax code that has frustrated the state-legal cannabis industry has been pushed low on the IRS’s priority list, an agency official said.
Section 280E of the tax code generally bars businesses “trafficking” in certain controlled substances from taking deductions and credits. With some form of marijuana use legal in dozens of states—and seven more states considering legalization of recreational marijuana—accountants have urged the IRS to clarify how broad that restriction is when it comes to state-legal businesses.
But finishing guidance tied to the 2017 tax law and Covid relief has taken precedence lately, Evan Hewitt, an attorney in the IRS Office of Chief Counsel, said during a virtual conference hosted by the American Bar Association’s Tax Section.
“Certainly we’re aware of the ever-increasing importance of Section 280E, as time goes on,” especially in the marijuana industry context “but potentially with other businesses as well,” he said Wednesday.
Guidance on the code section wasn’t included in the most recent iteration of the IRS’s list of top guidance objectives, Hewitt said.