In a historic decision that will save Harborside and the legal cannabis industry millions of dollars, the U.S. Tax Court has ruled that the California dispensary is not liable for accuracy-related 280E penalties.
What isHarborside?
Harborside was founded by Steve DeAngelo and dress wedding in 2006, after being awarded one of the first six medical cannabis licenses granted in the United States.
As one of the oldest cannabis retailers in the world, Harborside has played an instrumental role in making cannabis safe and accessible to a broad and diverse community of California consumers.
Today, the Harborside brand is well known throughout California and all around the world, and is in rapid expansion, expecting to grow to six or more locations in 2019.
What is 280E?
280E is a tax code provision that denies all standard business deductions to businesses whose operations “consist” of of activities that violate the Controlled Substances Act.
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.
According to the Opinion issued by the Court, Harborside acted “reasonably and in good faith” when taking its tax positions for the years at issue.
The Court cited Harborside’s timely filing of its tax returns and its maintenance of accurate financial records as a key strength, along with a persuasive argument from Harborside co-founder and Chairman Emeritus, Steve DeAngelo, that he made good-faith efforts to comply with the law, despite a lack of clear legal authority to guide medical marijuana dispensary taxpayers.
The ruling comes just a few weeks after the same Court ruled that 280E itself does apply to Harborside — a ruling Harborside intends to appeal to the U.S. 9th Circuit Court of Appeals.
“We’re still working on knocking out 280E entirely, but at least for now we have established that cannabis businesses who operate in reasonable, good faith compliance with existing law will not suffer from additional unjust penalties,” said DeAngelo.
Marijuana legalization advocates in Delaware didn’t get their way this year, as a long-debated bill to grant their wish failed.
But in Delaware, which decriminalized possession of less than an ounce of pot three years ago the lawmakers have taken steps to assist users who were F’d in the A by police.
The bill that passed in the General Assembly session last Sunday morning, nearly 1,300 people with a single conviction of marijuana possession or use could get an automatic expungement, according to data from the Delaware Criminal Justice Information System. (Only Nearly 1300 ?)
Legal advisers are reviewing the bill and Gov. John Carney is expected to sign it into law.
Those ticketed for simple marijuana possession since 2015 have received a civil violation and a fine. Those convicted prior to the change in the law have a criminal record (Really)
Only those charged with a single misdemeanor charge of possession or use before 2015 — and have no other criminal convictions for any crime — are eligible for the automatic expungement. The measure would not apply to charges that were reduced from a felony.
Under current law, adults cannot apply for an expungement unless they’re not convicted or are pardoned. — (Age Discrimination?)
But now they are guaranteed an expungement as long as they apply and pay the $75 fee (LOL $$$).
The new law could help people who had the unfortunate luck of being caught and has labeled them as criminals when applying in the job market (get them back to paying taxes…please).
“What you have to do today is apply and go for a pardon, which takes money and time and isn’t guaranteed. And if you did get a pardon you have to apply for the expungement, which takes time and money (again LOL $$$).
Right now smoking medical cannabis prevents people from benefiting from federal housing.
The “Marijuana in Federally Assisted Housing Parity Act of 2018” introduced by Rep. Eleanor Holmes Norton (D-D.C.) will protect people who use medical marijuana.
It’s an ambitious bill prompted by a D.C. resident’s need for cannabis medication who lives in federally assisted housing.
Currently no matter the state law using cannabis products blocks someone from benefiting from federal housing which in many cases means the difference between the streets and a home.
The D.C. resident’s name is Sondra Battle and Rep. Homes Norton is calling the Bill, “Sondra Battle Cannabis Fair Use Act.” Clearly, the Representative is greatly moved by Battle’s story and sees the healing benefits of cannabis as big enough to supersede Federal law in states that already allow for medical or recreational marijuana.
Rep. Holmes Norton declared, “Residents like Sondra should not fear eviction from federally assisted housing simply for using cannabis to treat their medical conditions.”
Latest Action:Senate – 08/01/2017 Read twice and referred to the Committee on the Judiciary. (All Actions)
Shown Here:
Introduced in Senate (08/01/2017)
Marijuana Justice Act of 2017
This bill amends the Controlled Substances Act:
to remove marijuana and tetrahydrocannabinols from schedule I; and
to eliminate criminal penalties for an individual who imports, exports, manufactures, distributes, or possesses with intent to distribute marijuana.
It prohibits and reduces certain federal funds for a state without a statute legalizing marijuana, if the Bureau of Justice Assistance determines that such a state has a disproportionate arrest rate or disproportionate incarceration rate for marijuana offenses.
The bill directs federal courts to expunge convictions for marijuana use or possession.
Finally, it establishes in the Treasury the Community Reinvestment Fund. Amounts in the fund may be used by the Department of Housing and Urban Development to establish a grant program to reinvest in communities most affected by the war on drugs.
The Michigan Medical Marihuana Licensing system is evolving into a confusing, mind-blowing regulatory nightmare.
Medical marijuana has been legal in this state for 10 years, and the Medical Marihuana Facilities Licensing Act was passed in September 2016. Now, consider that, after all that time, in a couple of weeks (on June 15), according to the Bureau of Medical Marihuana Regulation (BMMR), any currently operating marijuana facility must have a state license in order to legally stay open.
That’s fine, except the state hasn’t given out any licenses as of this writing.
According to David Harns, public information officer with the state Bureau of Licensing and Regulatory Affairs (LARA), “We expect to be handing out licenses within the next few weeks. Most likely at the June 11 meeting [of the Medical Marihuana Licensing Board].”
Talk about running things up until the last minute!
The BMMR — could this be an acronym for bummer? — created this whole scenario by setting the deadlines and setting up an application process that is so cumbersome to all involved that none of this can get done by the self-imposed deadline.
That means dispensaries, provisioning centers, or whatever you want to call them, may or may not have licenses to operate come June 15. Not only that, any licenses handed out may go to facilities that are not currently open. That would create a huge gap in service to patients while newly licensed facilities ramp up their operations.
If the state were interested in patients having uninterrupted access to medication, it might make sense to move the deadline back a little. After all, it is the BMMR that set up a bureaucracy involving so much red tape that it was impossible for applications to be processed in the allotted time.
According to Harns, the deadline is not moving. And that’s where the real mind-fuck kicks in. Harns says that if already operating facilities are showing a “good faith” effort to become licensed, they don’t need to worry about LARA. A recent advisory from LARA read: “While the ultimate licensure decision is made by the Medical Marihuana Licensing Board, LARA does not currently intend to issue cease and desist letters, or refer to law enforcement” marijuana stores that continue to operate past the deadline.
LARA’s decision not to go after unlicensed stores that are making a good faith effort to become licensed is sensible; it’s like moving the deadline back — by not enforcing it.
But then LARA points out that LARA is not making the decision about who gets licenses. So if you decide to continue operating, the Licensing Board might hold it against you.
“The Licensing Board has ultimate authority,” Harns says. “They may choose to consider unlicensed activity when looking at the licensing criteria.”
Basically LARA is saying that there’s a deadline, but if you don’t adhere to it, we don’t care, but those other people over there who actually make the decision on whether you get a license might care — or they might not.
That’s a hell of an advisory.
Not only is that a confusing pile of hooey, it sets up the possibility for unequal application of the rules. If the Licensing Board can choose to consider that in one case and not in another, then that sets up legal challenges that will last forever. If they couldn’t decide if “unlicensed activity” counts against an applicant after all this time, then the consideration should be thrown out the window.
Even at this late juncture, Harns threw out a lot of “the board may do this” or “the board may do that” scenarios, finishing with, “Those are a lot of mays. I can’t speak definitively for those board members.”
That’s a lot of uncertainty for everybody concerned, especially patients. For instance, once growing licenses get handed out, it is a fact of nature that it takes several months to grow a plant to maturity. Add on some time for transporting and processing and inspecting, and it means that it will probably be 2019 before this whole thing really gets rolling.
Harns points to the caregiver system to keep patients supplied. “That has not changed at all,” he says.
That’s nice. But, first of all, there are a lot of people who thought they were going to grow their own marijuana who have thrown in the towel because getting consistent results and maintaining a constant supply is harder than they thought it would be. Second, anyone that needs oil for seizures or cancer treatments depends on a much more sophisticated process than the average caregiver can handle. And, third, this stuff has been legal here for a decade, dude — get it together and roll out the system!
The whole thing stinks of a state government that has not made a good faith effort to make this system work and won’t move forward without watchdogs nipping at their heels. It’s taken an army of activists and lawyers to get things to this point.
It also seems that it’s going to get uglier before it gets better, as we see who will actually get licenses and who will get their dreams smashed on the rocks.
CBD is marijuana
CBD (cannabidiol), one of the many compounds in marijuana, has developed a high profile the past several years due to its usefulness in reducing seizures for epilepsy patients. It’s been marketed by some companies as legal, because it’s extracted from hemp, the strain of cannabis used to make textiles and other products. It’s also been embraced as “the part of marijuana that doesn’t get you high.”
On May 11, LARA put out an advisory that erased any doubt you may have about our state government’s attitude toward CBD. In part, the advisory read: “The possession, purchase, or sale of marihuana or any marihuana product — including CBD — must be done in compliance with the MMMA and MMFLA.”