Taxation Of A Medical Marijuana Business – How Will The Ninth Circuit Hold?

Taxation Of A Medical Marijuana Business – How Will The Ninth Circuit Hold?

The Stage is Set On December 3, 2019, Taxpayer timely[i] filed a notice of appeal from a decision of the U.S. Tax Court that had been entered approximately two months earlier.[ii] Source JD Supra: https://www.jdsupra.com/legalnews/taxation-of-a-medical-marijuana-65114/ Because Taxpayer is a corporation, the Tax Court’s decision will be reviewed by the Court of Appeals for the Ninth Circuit, which is the circuit in which Taxpayer’s principal place of business is located.[iii] It is also the largest of the thirteen Courts of Appeals – thus, it is one of the most influential.[iv] In accordance with the Code,[v] the Ninth Circuit will review de novo[vi] the legal rulings set forth in the Tax Court’s opinion. With that, the stage is set for another episode of “Cannabis v. the Code.” You all know our first contestant, the Commissioner of Internal Revenue, who hails from Washington, D.C.[vii] Before introducing our second contestant – specifically, the appellant Taxpayer – let’s review the contest rules.[viii] The Code Under Federal law, cannabis is a “Schedule I” controlled substance; thus, the manufacture, distribution, dispensation, or possession of marijuana – even medical marijuana recommended by a physician – is prohibited as a matter of Federal law.[ix] Deductions The Code allows a business to deduct, for purposes…

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Source : CANNANNEW REPORT
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