Taxes

I am wondering what other caregivers are doing about taxes. Unless you provide meds for free, do you charge sales tax? Have a tax number for your caregiver business? What do/will you report, and to whom? Or, did they take the tax requirements out of the new law?

We are still required to collect sales tax. Just put away 5% of your transaction amount I guess. Track your sales. I'm hoping by tax time we will know what to do with this 5%. To be taken seriously we need to provide some revenue for this state! I really do want them to get their share. I wouldn't report it federally I guess, but I wish I could. I'd gladly pay the FEDS their share too. Claiming this stuff is kind of scary though. When this industry gets large enough to make a fiscal difference, federal laws will change. Tobacco and alcohol are big revenue and thats why they are protected. We need the cannabis industry to be held in a similar regard. I think your tax ID number is just your social security number, just treat it like your self employed. I wonder what caregivers in other states do and how they file?

I'm actually planning on forming an LLC for my business and using that. I already have another LLC and I got a fed tax ID for that one. It's easy to do all of it. Having an LLC makes it so easy to separate things.
BTW, I noticed a couple months ago that there is currently a bill in Congress to allow tax deductions for medical marijuana caregiver/dispensary expenses. If they did that, we could claim the income/loss.

get an IEN. register an LLC, protect yourself with the corporate vail of security. you'll pay the state an extra 200$ and your lawyer a lot more. butyour already paying the state 1500$ for the caregiver. an IEN (tax id number) and proper paper work. write reciepts, keep records. I am paying the feds. thats crazy! pay the feds, you think your more likely to get in trouble not paying them taxes then you will by paying them? pay your taxes man.

I am fully incoprorated, IEN, operating aggreement, LLC'ed and the feds get my money (or they will by january 20th).

this is a greta topic point though. what is everyone doing about patient contracts? Has anyone brought a business plan to a bank yet? (btw: Key bank had an offical memo go out saying NO LOANS to MMJ business plans) What kind of lawyer you guys running? Mine is business and mitgation but his firm has a criminal law guy working for them and my retainer picks them both up. I don't plan on needing the criminal law guy but hell.. :/ anybody else got a legal strategy going? Marketing? pheonix? (lol)

business 101 discussion stuff


I don't mean to hijack tet, if this is a problem i can start a new thread.

cerberus said:

this is a greta topic point though. what is everyone doing about patient contracts? Has anyone brought a business plan to a bank yet? (btw: Key bank had an offical memo go out saying NO LOANS to MMJ business plans) What kind of lawyer you guys running? Mine is business and mitgation but his firm has a criminal law guy working for them and my retainer picks them both up. I don't plan on needing the criminal law guy but hell.. :/ anybody else got a legal strategy going? Marketing? pheonix? (lol)

business 101 discussion stuff


I don't mean to hijack tet, if this is a problem i can start a new thread.

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No worries cerberus, it's all relevant. I personally don't see a need to do all that you have done, not that there is anything wrong with that. An LLC is simple, got one for a rental property I own. A patient agreement might be a good idea.

New law, old cards

I assume that the cards I hold now as patient and caregiver remain in good standing until their expiration dates. As such, I wouldn't need doctor cert for those patients, correct?

correct.....they can get the new rec and ditch the cards if you want......but the cards are still good

so you havent consulted with a lawyer? thought about advertising/marketing to aquire new patients? The loan part makes since, as i am rolling two business into one and looking for a chunk to add to infastructure, (lights and cooling) but nobody has thought of going to a bank for a business loan? hmm interesting.. honestly with disspensaries not opening and the ones that are, can't take on new patients. I'm making my plans with the assumption of maximum growth, a second caregiver (per live in rule) and then I'll start being a partner/venture capitalist with/for other caregivers, keeping myself seperate from the garden but not the business (legal). Maine (by luck or reason) has set this up to be a micro market, with advatage to the little guy and I'm going to take it.

btw, taxes: charge a service fee to your patients rather than product fee, the feds charge taxes on products bought and sold bought not on services. ie, state but no federal tax.. lawyers are good

the feds have tightened up with banks dealing with MMJ, threatened them with facing federal charges of aiding a criminal enterprise(still federally illegal)....therefore no bank is gonna loan money for a grow op, caregiver setup, dispensary etc.....

isnt 1500$ enough to cover taxes? no other buisness pays those fees just to start operating...looks like douyble dippin' to me....

Biological Graffity said:

isnt 1500$ enough to cover taxes? no other buisness pays those fees just to start operating...looks like douyble dippin' to me....

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wrong. I don't want to pay it either but the casino in oxford pays 80,000 a year in licnece fee and 20,000 application fee, plus state and fed taxes.. they arent being nice to us but they sure as hell arent double dippin..

besides, you live here, I don't mind helping out my community a little with some 5%, or donations (which is what I do)

really? you write off donations?did you mean cash donations or medicine? either way 5% isnt that much...I havent asked my accountant yet about what I'll have to pay....

yeah, any donation is a tax write off, books at goodwill are worth 5 dollars each tax credits. so, cash or medicine, IF you can find a registered NGO (non-profit) that will take the meds and give you a reciept.. ALSO, charge it as a service fee and not as product and you'll still have to pay a state service tax (new law) but the feds don't charge for that.. I still have a per tiem fee for edibles and specialty items but again, I think paying the state and feds their cut is only good business.

2 thoughts, alcholl and tobaco pay higher tax rates, as do yacht makers and if it was all completely illegal and you were actually making money at this, you'd be cutting a much meaner person into a larger share..

peace

As far as the IRS and tax code 280E is concerned, you get no tax write offs or exemptions if you are involved schedule 1 and 2 drugs. Not donations,employee wages, rent, electric, gas, nutes, soil, whatever.........nothing. It's all taxable. They don't care if its a service fee or not. Tax courts seem to be upholding this in California. It's like begging for an audit.

I believe a senator has a bill in committee specifically for allowing deductions for mmj expenses.

sweetleaf76 said:

As far as the IRS and tax code 280E is concerned, you get no tax write offs or exemptions if you are involved schedule 1 and 2 drugs. Not donations,employee wages, rent, electric, gas, nutes, soil, whatever.........nothing. It's all taxable. They don't care if its a service fee or not. Tax courts seem to be upholding this in California. It's like begging for an audit.

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really? I'll look into that..

thats a fact.....no deductions of any kind.....period......you should update both your lawyer and accountant....some don't know about that law, but they all should.....

Congress and the IRS will figure it out eventually. There is huge potential for revenue here, but people are not going to report it (generally) until and unless it is legal and treated as a business (expenses etc).
imo there is a small possibility that the debt commission could include something. If they're smart they will. It's a way to sell it back home because it is all or nothing on their recommendations. They have to find trillions. Same for online poker, more billions of free money they could include in their list.

some thoughts on the subject

this says the IRS has sent a letter to sen shumaker about this topic, (in our favor)
http://www.huffingtonpost.com/2010/08/05/can-you-write-off-medical_n_672360.html

here is Montana protecting people
http://revenue.mt.gov/forindividuals/medical-marijuana.mcpx


Small Business Tax Equity Act (name of the act to allow deductions)


good info guys, I had slipped it into a conversation with my lawyer but I wonder if he was thinking personal vs business deduction.. (if I donate an ounce to a hospice, and they write a donations reciept of herbal remedies and a value, then its quietly addressed BUT a dispensory or a caregiver business wouldnt have the same descresion..