A recently released report from a branch of the U.S. Treasury Department states the Internal Revenue Service is preparing to launch an increase in marijuana industry audits nationwide, However, it also offers a possible way for marijuana companies to skirt federal taxes.
The IRS is closely monitoring the marijuana industry and intends to target companies that have failed to pay their full federal tax obligations.The agency has plans to enforce the collection of those taxes.
The report – written by the Treasury Inspector General for Tax Administration (TIGTA) – found there are likely hundreds of millions of dollars in unpaid taxes owed by the marijuana industry under Section 280E of the Internal Revenue Code, which prohibits standard business deductions by companies that traffic in federally illegal drugs, including marijuana.
26 U.S. Code § 280E.Expenditures in connection with the illegal sale of drugs
No deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances (within the meaning of schedule I and II of the Controlled Substances Act) which is prohibited by Federal law or the law of any State in which such trade or business is conducted.
Definition of Controlled Substance Schedules
Drugs and other substances that are considered controlled substances under the Controlled Substances Act (CSA) are divided into five schedules. An updated and complete list of the schedules is published annually in Title 21 Code of Federal Regulations (C.F.R.) §§1308.11 through 1308.15. Substances are placed in their respective schedules based on whether they have a currently accepted medical use in treatment in the United States, their relative abuse potential, and likelihood of causing dependence when abused. Some examples of the drugs in each schedule are listed below.
Schedule I Controlled Substances
Substances in this schedule have no currently accepted medical use in the United States, a lack of accepted safety for use under medical supervision, and a high potential for abuse.
Some examples of substances listed in Schedule I are: heroin, lysergic acid diethylamide (LSD), marijuana (cannabis), peyote, methaqualone, and 3,4-methylenedioxymethamphetamine (“Ecstasy”).
Schedule II/IIN Controlled Substances (2/2N)
Substances in this schedule have a high potential for abuse which may lead to severe psychological or physical dependence.
Examples of Schedule II narcotics include: hydromorphone (Dilaudid®), methadone (Dolophine®), meperidine (Demerol®), oxycodone (OxyContin®, Percocet®), and fentanyl (Sublimaze®, Duragesic®). Other Schedule II narcotics include: morphine, opium, codeine, and hydrocodone.
Examples of Schedule IIN stimulants include: amphetamine (Dexedrine®, Adderall®), methamphetamine (Desoxyn®), and methylphenidate (Ritalin®).
Other Schedule II substances include: amobarbital, glutethimide, and pentobarbital.
Farmington Hills, MI-based Attorney Michael Komorn who has represented the medical marijuana businesses and recreational cannabis licensing and legal defense stated “Here they come like we knew they would… so now is the time to prepare.”
Temporary requirement to suspend activities that are not necessary to sustain or protect life
The novel coronavirus (COVID-19) is a respiratory disease that can result in serious illness or death. It is caused by a new strain of coronavirus not previously identified in humans and easily spread from person to person. Older adults and those with chronic health conditions are at particular risk, and there is an increased risk of rapid spread of COVID-19 among persons in close proximity to one another. There is currently no approved vaccine or antiviral treatment for this disease.
On March 10, 2020, the Michigan Department of Health and Human Services identified the first two presumptive-positive cases of COVID-19 in Michigan. On that same day, I issued Executive Order 2020-4. This order declared a state of emergency across the state of Michigan under section 1 of article 5 of the Michigan Constitution of 1963, the Emergency Management Act, 1976 PA 390, as amended, MCL 30.401-.421, and the Emergency Powers of the Governor Act of 1945, 1945 PA 302, as amended, MCL 10.31-.33.
The Emergency Management Act vests the governor with broad powers and duties to “cop[e] with dangers to this state or the people of this state presented by a disaster or emergency,” which the governor may implement through “executive orders, proclamations, and directives having the force and effect of law.” MCL 30.403(1)-(2). Similarly, the Emergency Powers of the Governor Act of 1945, provides that, after declaring a state of emergency, “the governor may promulgate reasonable orders, rules, and regulations as he or she considers necessary to protect life and property or to bring the emergency situation within the affected area under control.” MCL 10.31(1).
To suppress the spread of COVID-19, to prevent the state’s health care system from being overwhelmed, to allow time for the production of critical test kits, ventilators, and personal protective equipment, and to avoid needless deaths, it is reasonable and necessary to direct residents to remain at home or in their place of residence to the maximum extent feasible.
This order takes effect on March 24, 2020 at 12:01 am, and continues through April 13, 2020 at 11:59 pm.
Acting under the Michigan Constitution of 1963 and Michigan law, I order the following:
This order must be construed broadly to prohibit in-person work that is not necessary to sustain or protect life.
Subject to the exceptions in section 7, all individuals currently living within the State of Michigan are ordered to stay at home or at their place of residence. Subject to the same exceptions, all public and private gatherings of any number of people occurring among persons not part of a single household are prohibited.
All individuals who leave their home or place of residence must adhere to social distancing measures recommended by the Centers for Disease Control and Prevention, including remaining at least six feet from people from outside the individual’s household to the extent feasible under the circumstances.
No person or entity shall operate a business or conduct operations that require workers to leave their homes or places of residence except to the extent that those workers are necessary to sustain or protect life or to conduct minimum basic operations.
For purposes of this order, workers who are necessary to sustain or protect life are defined as “critical infrastructure workers,” as described in sections 8 and 9.
For purposes of this order, workers who are necessary to conduct minimum basic operations are those whose in-person presence is strictly necessary to allow the business or operation to maintain the value of inventory and equipment, care for animals, ensure security, process transactions (including payroll and employee benefits), or facilitate the ability of other workers to work remotely.
Businesses and operations must determine which of their workers are necessary to conduct minimum basic operations and inform such workers of that designation. Businesses and operations must make such designations in writing, whether by electronic message, public website, or other appropriate means. Such designations, however, may be made orally until March 31, 2020 at 11:59 pm.
Businesses and operations that employ critical infrastructure workers may continue in-person operations, subject to the following conditions:
Consistent with sections 8 and 9, businesses and operations must determine which of their workers are critical infrastructure workers and inform such workers of that designation. Businesses and operations must make such designations in writing, whether by electronic message, public website, or other appropriate means. Such designations, however, may be made orally until March 31, 2020 at 11:59 pm. Businesses and operations need not designate:
Workers in health care and public health.
Workers who perform necessary government activities, as described in section 6.
Workers and volunteers described in section 9(d).
In-person activities that are not necessary to sustain or protect life must be suspended until normal operations resume.
Businesses and operations maintaining in-person activities must adopt social distancing practices and other mitigation measures to protect workers and patrons. Those practices and measures include, but are not limited to:
Restricting the number of workers present on premises to no more than is strictly necessary to perform the business’s or operation’s critical infrastructure functions.
Promoting remote work to the fullest extent possible.
Keeping workers and patrons who are on premises at least six feet from one another to the maximum extent possible, including for customers who are standing in line.
Increasing standards of facility cleaning and disinfection to limit worker and patron exposure to COVID-19, as well as adopting protocols to clean and disinfect in the event of a positive COVID-19 case in the workplace.
Adopting policies to prevent workers from entering the premises if they display respiratory symptoms or have had contact with a person who is known or suspected to have COVID-19.
Any other social distancing practices and mitigation measures recommended by the Centers for Disease Control.
All in-person government activities at whatever level (state, county, or local) that are not necessary to sustain or protect life, or to supporting those businesses and operations that are necessary to sustain or protect life, are suspended.
For purposes of this order, necessary government activities include activities performed by critical infrastructure workers, including workers in law enforcement, public safety, and first responders.
Such activities also include, but are not limited to, public transit, trash pick-up and disposal, activities necessary to manage and oversee elections, operations necessary to enable transactions that support the work of a business’s or operation’s critical infrastructure workers, and the maintenance of safe and sanitary public parks so as to allow for outdoor recreation.
For purposes of this order, necessary government activities include minimum basic operations, as described in section 4(b). Workers performing such activities need not be designated.
Any in-person government activities must be performed consistently with the social distancing practices and other mitigation measures to protect workers and patrons described in section 5(c).
Exceptions.
Individuals may leave their home or place of residence, and travel as necessary:
To engage in outdoor activity, including walking, hiking, running, cycling, or any other recreational activity consistent with remaining at least six feet from people from outside the individual’s household.
To perform their jobs as critical infrastructure workers after being so designated by their employers. (Critical infrastructure workers who need not be designated under section 5(a) may leave their home for work without a designation.)
To conduct minimum basic operations, as described in section 4(b), after being designated to perform such work by their employers.
To perform necessary government activities, as described in section 6.
To perform tasks that are necessary to their health and safety, or to the health and safety of their family or household members (including pets). Individuals may, for example, leave the home or place of residence to secure medication or to seek medical or dental care that is necessary to address a medical emergency or to preserve the health and safety of a household or family member (including procedures that, in accordance with a duly implemented nonessential procedures postponement plan, have not been postponed).
To obtain necessary services or supplies for themselves, their family or household members, and their vehicles. Individuals must secure such services or supplies via delivery to the maximum extent possible. As needed, however, individuals may leave the home or place of residence to purchase groceries, take-out food, gasoline, needed medical supplies, and any other products necessary to maintain the safety, sanitation, and basic operation of their residences.
To care for a family member or a family member’s pet in another household.
To care for minors, dependents, the elderly, persons with disabilities, or other vulnerable persons.
To visit an individual under the care of a health care facility, residential care facility, or congregate care facility, to the extent otherwise permitted.
To attend legal proceedings or hearings for essential or emergency purposes as ordered by a court.
To work or volunteer for businesses or operations (including both and religious and secular nonprofit organizations) that provide food, shelter, and other necessities of life for economically disadvantaged or otherwise needy individuals, individuals who need assistance as a result of this emergency, and people with disabilities.
Individuals may also travel:
To return to a home or place of residence from outside this state.
To leave this state for a home or residence elsewhere.
To travel between two residences in this state.
As required by law enforcement or a court order, including the transportation of children pursuant to a custody agreement.
For purposes of this order, critical infrastructure workers are those workers described by the Director of the U.S. Cybersecurity and Infrastructure Security Agency in his guidance of March 19, 2020 on the COVID-19 response (available here). Such workers include some workers in each of the following sectors:
Health care and public health.
Law enforcement, public safety, and first responders.
Food and agriculture.
Energy.
Water and wastewater.
Transportation and logistics.
Public works.
Communications and information technology, including news media.
Other community-based government operations and essential functions.
Critical manufacturing.
Hazardous materials.
Financial services.
Chemical supply chains and safety.
Defense industrial base.
For purposes of this order, critical infrastructure workers also include:
Child care workers (including workers at disaster relief child care centers), but only to the extent necessary to serve the children or dependents of critical infrastructure workers as defined in this order. This category includes individuals (whether licensed or not) who have arranged to care for the children or dependents of critical infrastructure workers.
Workers at designated suppliers and distribution centers, as described below.
A business or operation that employs critical infrastructure workers may designate suppliers, distribution centers, or service providers whose continued operation is necessary to enable, support, or facilitate the work of its critical infrastructure workers.
Such suppliers, distribution centers, or service providers may designate workers as critical infrastructure workers only to the extent those workers are necessary to enable, support, or facilitate the work of the original operation’s or business’s critical infrastructure workers.
Designated suppliers, distribution centers, and service providers may in turn designate additional suppliers, distribution centers, and service providers whose continued operation is necessary to enable, support, or facilitate the work of their critical infrastructure workers.
Such additional suppliers, distribution centers, and service providers may designate workers as critical infrastructure workers only to the extent that those workers are necessary to enable, support, or facilitate the work of the critical infrastructure workers at the supplier, distribution center, or service provider that has designated them.
Businesses, operations, suppliers, distribution centers, and service providers must make all designations in writing to the entities they are designating, whether by electronic message, public website, or other appropriate means. Such designations may be made orally until March 31, 2020 at 11:59 pm.
Businesses, operations, suppliers, distribution centers, and service providers that abuse their designation authority shall be subject to sanctions to the fullest extent of the law.
Workers in the insurance industry, but only to the extent that their work cannot be done by telephone or remotely.
Workers and volunteers for businesses or operations (including both and religious and secular nonprofit organizations) that provide food, shelter, and other necessities of life for economically disadvantaged or otherwise needy individuals, individuals who need assistance as a result of this emergency, and people with disabilities.
Workers who perform critical labor union functions, including those who administer health and welfare funds and those who monitor the well-being and safety of union members who are critical infrastructure workers, provided that any administration or monitoring should be done by telephone or remotely where possible.
Nothing in this order should be taken to supersede another executive order or directive that is in effect, except to the extent this order imposes more stringent limitations on in-person work, activities, and interactions. Consistent with prior guidance, a place of religious worship, when used for religious worship, is not subject to penalty under section 14.
Nothing in this order should be taken to interfere with or infringe on the powers of the legislative and judicial branches to perform their constitutional duties or exercise their authority.
This order takes effect on March 24, 2020 at 12:01 am, and continues through April 13, 2020 at 11:59 pm.
The governor will evaluate the continuing need for this order prior to its expiration. In determining whether to maintain, intensify, or relax its restrictions, she will consider, among other things, (1) data on COVID-19 infections and the disease’s rate of spread; (2) whether sufficient medical personnel, hospital beds, and ventilators exist to meet anticipated medical need; (3) the availability of personal protective equipment for the health-care workforce; (4) the state’s capacity to test for COVID-19 cases and isolate infected people; and (5) economic conditions in the state.
Consistent with MCL 10.33 and MCL 30.405(3), a willful violation of this order is a misdemeanor.
Given under my hand and the Great Seal of the State of Michigan.
Michigan Gov. Gretchen Whitmer orders everyone to stay at home today March 23, 2020 to limit the spread of corona virus. through April 13, 2020.
Gov. Gretchen Whitmer has issued a “stay at home” order for Michigan, effective at midnight tonight, in response to the coronavirus crisis.
The order, draws on Whitmer’s broad executive powers under a state of emergency. Though sweeping, it includes exemptions for essentials such as:
Shopping for food or medicine
Getting needed medical treatment
Getting fuel
Walking a pet
Walking for exercise
Staffing to allow maintenance of “minimal business operations” for many employers
Essential workers such as police, fire, hospital, grocery store and pharmacy workers are also exempted, as are their workplaces.
The order also bans all public and private gatherings of any size outside of a family home. An earlier order had limited gatherings to no more than 50.
The authority for governors to issue executive orders is found in state constitutions and statutes (Michigan State Constitution) as well as case law, or is implied by the powers assigned to state chief executives. Governors use executive orders—certain of which are subject to legislative review in some states—for a variety of purposes, among them to:
trigger emergency powers during natural disasters, energy crises, and other situations requiring immediate attention;
create advisory, coordinating, study, or investigative committees or commissions; and
address management and administrative issues such as regulatory reform, environmental impact, hiring freezes, discrimination, and intergovernmental coordination.
As chief executive, governors are responsible for ensuring their state is adequately prepared for emergencies and disasters of all types and sizes. Most emergencies and disasters are handled at the local level, and few require a presidential disaster declaration or attract worldwide media attention. Yet governors must be as prepared for day-to-day events—tornadoes, floods, power outages, industrial fires, and hazardous materials spills—as for catastrophes on the scale of Hurricane Katrina or the September 11 terrorist attacks. States focus on four stages of disaster or emergency management:
Prepare
Prevent
Respond
Recover
These components afford a useful rubric for thinking about the cycle of disasters and emergencies and for organizing recommendations for state action. During an emergency, the governor also plays a key role in communicating with the public during an emergency, providing advice and instructions and maintaining calm and public order.
State emergency management laws usually define how a governor may declare and end a state of emergency. In some cases, the necessary response to a disaster is beyond the capacity of state and local governments. A state may petition the President to declare a major disaster. The declaration of a major disaster triggers a variety of federal programs depending on the scope of the disaster and the type of losses experienced.
California Gov. Gavin Newsom made the announcement on Thursday night, asking nearly 40 million residents in the state to stay at home to prevent the spread of the coronavirus.
“There’s a mutuality, and there’s a recognition of our interdependence, that requires of this moment that we direct a statewide order for people to stay at home,” Newsom said.
The Department states cannabis is an essential medicine.
The Department adds,”Dispensaries can continue to operate as essential businesses during this time, while practicing social distancing and other public health recommendations.”
Statement from First Natural Wellness, in conjunction with Komorn Law regarding telemedicine for medical marijuana
ANN ARBOR, Mich., March 19, 2020 /PRNewswire/
Michigan medical marijuana physicians, attorneys, patients, and their caregivers called on Governor Gretchen Whitmer to provide urgent and swift action via an executive order to allow certifying physicians the emergency capabilities to certify patients via telemedicine.
In times of need, communities stand
together to defend the weak. Komorn Law, First Natural Wellness, and the
Michigan Medical Marijuana Association (MMMA) is comprised of stakeholders and
citizens who are urging Governor Whitmer to take the COVID-19 pandemic
seriously by allowing physicians to provide telemedicine consultations for
patients who need medical cannabis therapy.
The Michigan Medical Marihuana Act
(“MMMA”) provides immunities for physicians to recommend medical
cannabis, and immunities for patients to engage in the medical use of
marijuana. The MMMA, as with other expectations of licensed physicians in Michigan,
requires that a bona fide relationship exist between the physician and the
patient. In April of 2012 (2012 PA 2012 512) the Legislature in Michigan by
a Super Majority vote amended the MMMA (2012 Public Act 512) to specifically
define the term “bona fide physician-patient relationship.” The
amendment to the MMMA created and defined the term “Bona Fide” as
follows:
(a) “Bona fide physician-patient
relationship” means a treatment or counseling relationship between a
physician and patient in which all of the following are present:
(1) The physician has reviewed the patient’s relevant medical records and
completed a full assessment of the patient’s medical history and current
medical condition, including a relevant, in-person, medical
evaluation of the patient.
Patient-Caregiver-Coalition (see details at end of article)
Said another way, only physicians
who interact with medical marijuana patients are required to meet in person and
or are precluded from those interactions occurring via telemedicine.
Legislators who lobbied for this
face-to-face requirement in the law were simultaneously approving telemedicine
visits for insurance reimbursements for almost every other medical visit except
medical marijuana consultations.
Many of the 300,000 Medical cannabis
patients are the sickest patients in the State. They have some of the most
severe conditions for physicians to evaluate, including Cancer, HIV/AIDS, Hep
C, Arthritis, and Glaucoma just to name part of the qualifying conditions list.
These are the sickest people in the state, and current law mandates that these
patients interact with their physicians in person. In light of the COVID-19
pandemic and the State of Emergency our Governor declared for the State of
Michigan, we are demanding that our state officials address this issue. This
enormous population of medical marijuana patients and their physicians are
currently being overlooked and ignored. Putting aside the
unexplained stigma excluding medical marijuana patients and doctors from
telemedicine, the existing policy is subjecting an enormous population of sick
patients and their physicians to a dangerous and irrational policy, arguably
which should never have existed.
Now is the time to urge Governor Gretchen Whitmer to protect all of our citizens, including patients and physicians. Please call Governor Whitmer’s office at 517-373-3400 or 517-335-7858 and urge her to let physicians provide medical marijuana certifications via telemedicine services immediately.
Komorn Law and the Michigan Medical Marijuana Association have been at the forefront of the legal battles and in the trenches fighting fo patient, caregiver and physician rights since 2008. We are still fighting at this very moment to keep the caregiver system working while others are tryin to end it. So get on the lit to be notified as soon as the “pandemic” is over.
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Here’s a list of news articles related to Michigan State Police datamaster investigation into inaccurate settings by a contractor which may have lead to false readings for DUI checks.
If you are looking for an attorney that will fight for you. You found him. Michael Komorn – provides DUI, drugged driving and criminal defense passionately an aggressively. Call The Office 248-357-2550 or visit KomornLaw.com
