Colorado Pot Business Shareholders on Hook for Unpaid Taxes

Feb. 26, 2019, 10:39 PM

Shareholders in a state-legal medical marijuana business in Colorado failed to convince a federal appeals court to let them claim certain tax deductions that aren’t allowed for businesses that sell federally illegal drugs.

A Feb. 26 ruling by the U.S. Court of Appeals for the 10th Circuit is the latest in a string of losses for marijuana-related businesses seeking to take advantage of business expense deductions companies can normally enjoy. Tax Code Section 280E prohibits deductions for businesses engaged in unlawful trafficking of controlled substances.

In the case in question, the Internal Revenue Service disallowed deductions sought by three shareholders ...

To read the full article log in.

Learn more about a Bloomberg Tax subscription.