Also remember that as an employee/officer of the corporation you are allowed to make a living wage so once your up and running I would be sure to always leave a few thousand extra each year to donate, that will look good on you if you ever wind up in front of the judge. Heck with my goal of having 60 to 70 plants in soil indoors eventually when I reach that level I should be pulling in around 400k plus per year less expenses. To me giving away a few k every year is worth the extra reputation it will give me in court, it can make the difference between going to trial or not going in some cases.
If you have anymore questions feel free to ask, I'm always glad to help, peace out.
Now most don't follow the law and do this under the radar as they say. Now if you were to get busted but be legal in all other respects they can still come after you for tax evasion which is very bad and hard to fight not to mention way costly. Others try to wash the money thru legitimate businesses but that can get you in trouble also, it's best just to pay the money for the legal setup and be able to rest easy at night. Also be sure to look on the Norml website for legal and lawyer information, most lawyers that specialize in Prop 215 matters are listed up there and virtually every county has some lawyers that deal strictly with this. They also will generally know several accountants that they can refer you to that also will have experience in this area.
Now after setting all of that up you will need an accountant, so that you can get paid the legal way. You will set your salary as an officer of the corporation, any monies that you make over and above this must be given away to charity, hence no profit for the corporation and no taxes need to be paid. You will then get a paycheck however often you and your accountant decide either weekly, bi-weekly or monthly. This check will have all of your deductions for fed and state withholding's then at the end of the year you file a normal tax return for individuals.
So to sum all of that up you need a lawyer and accountant as the minimum, in a large operation you will probably wind up with employees also, such as trimmers and helpers. They will need to be paid by the corporation also, including their payroll taxes. Also when you and them file your taxes all the IRS will know is that you and them work for XYZ corporation which is a non-profit.
Next you have to keep your taxes legal, the IRS don't play so you have to declare all incomes from your sales. Now under IRS guidelines since MMJ is not recognized by the feds the IRS does not allow deductions as the cost of doing business, such as equipment and the such. There is a way around this, you have to start a non-profit corporation which is then allowed to deduct certain fees and expenses, it still won't allow for 100% and there is no depreciation that you can run either in this business.
Some areas I have read require these types of operations to have each plant tagged, I know that up north they do that on most outdoor grows. But down here in SD they don't have the same requirements, we just have to be careful of location such as how close to schools we are. Now if you were to get raided due to nosy neighbors or what not and your grow is legal then if you stay at the same location because your landlord doesn't mind or you own your own place then you can bet that once in awhile the Man will stop by just to check, that's the price of doing business sometimes.
Now the DEA has stated so far that they are not concerned with operations under 100 plants, but keep in mind that is subject to change. But the main reason is due to the way they are handled in the courts, under 100 plants automatically reverts to state control where we can use our MMJ defense, unlike in federal court.
I'm not familiar with other areas of Cali for growing rights but I do know that here in San Diego most doctors will give you a 99 plant prescription/permit/grow license for a nominal fee LOL That varies anywhere from $200 to $300. Now that allows for the total of 99 root structures which is how the feds count our crops so this includes any clones/mothers that you're using. That is why you will see as my grow progresses I will eventually stop at 60 to 70 plants to allow for mothers and clones.
-If I have a warehouse and I am growing 99 plants, I need to have at least 17 non-growing patients under my collective (as per the 6 mature plants per person guideline in CA)
-If I have a warehouse I need to notify local authorities that I am having a growing operation
-If I have a warehouse I need to make sure it is far away from schools and children
-I need to log the hours I am working at the warehouse for tax purposes, and declare a dollar amount for my salary
-Declare my taxes as one normally would with an accountant based on this amount
-Announce that I am growing medical marijuana to the IRS when I pay my taxes (?)
Some questions I have:
-Won't notifying local authorities about the operation give them the right to contact federal authorities?
-If the warehouse is being rented how will we announce the operation?
Thanks a lot and I wish you the best,
Hey I saw your post in the forum "All You Care Givers Out There, Do You Pay Your Taxes?" and I'd like to hopefully get some more info on it from you. I am currently in a collective that is going to be opening a warehouse in Southern CA, and I do not know if they are going to be taking all the procedures you mentioned into consideration. I'm not sure if they are even going to be paying their taxes. I'm a little concerned because I want to work there at the warehouse and help them grow but I want to be protected under CA law. I am going to try and get as much information from them as I can, but first let me see if I can re-iterate what you said in your post.