By current Internal Revenue Service standards, LivWell Enlightened Health and many of its brethren in legal weed are “glorified tax collectors,” says John Lord, chief executive officer of one of Colorado’s largest dispensary chains.
Lord joins Cannabist editor-in-chief Ricardo Baca on The Cannabist Show to explain 280E, an IRS tax code that is causing plenty of consternation in the cannabis industry.
IRS code 280E, which is intended to have drug dealers declare their ill-gotten gains, does not allow marijuana businesses legally operating in Colorado to take deductions or receive credits.
More on weed and 280E
Subscribe to our newsletter here.
“Effectively, that other business is taxed at 35 percent — cannabis is taxed at probably close to 80 cents on the dollar in a true tax situation,” Lord says.
Lord describes how his firm is under “continuous audit” by state and federal regulators and what fixes are needed.