IRS 280E

IRS 280E is a tax code affecting cannabis businesses' deductions.

Cannabis cultivation software
IRS Section 280E is a tax code that prohibits businesses involved in the trafficking of Schedule I or II controlled substances, such as cannabis, from deducting standard business expenses. This limitation significantly impacts cannabis businesses, as they cannot claim typical deductions that other businesses can. However, businesses can still deduct the Cost of Goods Sold (CoGS), making accurate CoGS calculations crucial for minimizing tax liabilities.

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