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Marijuana

IRS Guidance On How Illegal Drug Businesses Should Compute Cost Of Goods Sold

IRS Guidance On How Illegal Drug Businesses Should Compute Cost Of Goods Sold

Chief Counsel Advice 201504011   In Chief Counsel Advice (CCA), IRS has: 1) concluded that persons that traffic in Schedule I and Schedule II controlled substances (e.g., marijuana) can currently deduct cost of goods sold (COGS) but must determine COGS by using rules that existed before the enactment of Code Sec. 263A to determine inventoriable […]

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Tax Court – No deduction when medical marijuana dispensary’s inventory, etc. was confiscated by DEA

Tax Court – No deduction when medical marijuana dispensary’s inventory, etc. was confiscated by DEA

Beck, TC Memo 2015-149 The Tax Court has held that a medical marijuana dispensary business could not claim, either as cost of goods sold (COGS) or as a loss, the cost of items seized during the Drug Enforcement Administration’s (DEA’s) raid. It also wasn’t able to deduct its business expenses.  Click here for the Opinion […]

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State marijuana excise tax is a reduction in the amount realized on product’s sale

State marijuana excise tax is a reduction in the amount realized on product’s sale

Chief Counsel Advice 201531016 In Chief Counsel Advice (CCA), IRS has concluded that a business legally selling marijuana under state law can treat the payment of state excise taxes on the production, processing, or retail sale of the product as a reduction in the amount realized on the sale. As a result, the tax was […]

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Court of Appeals Ninth Circuit affirms; no business deductions for legal medical marijuana dispensary

Court of Appeals Ninth Circuit affirms; no business deductions for legal medical marijuana dispensary

Olive v. Comm., (CA 9  7/09/2015) 116 AFTR 2d ¶2015-5031 The Court of Appeals for the Ninth Circuit, fielding many of the same taxpayer arguments as the Tax Court and some new ones, has affirmed the Tax Court’s holding that a taxpayer was precluded under Code Sec. 280E from deducting any expenses related to his […]

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Failure-To-Deposit Penalty Relief For Taxpayers Unable to Open a Bank Account

Failure-To-Deposit Penalty Relief For Taxpayers Unable to Open a Bank Account

IRS has issued interim guidance that allows taxpayers who are unable to get a bank account, or make other arrangements for depositing their tax deposit obligations electronically, to obtain an abatement of the failure to deposit penalty if they follow certain procedures. This provision provides relief to taxpayers who legally sell marijuana under state law […]

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Meet Paul Raymond

Meet Paul Raymond

Mr. Raymond is a sought after speaker in tax controversy law by many attorney, accountant, and business groups and at the request of the Internal Revenue Service, has presented programs at the IRS Nationwide Tax Forum, attended by tax professionals throughout the United States.

Additionally, he continues to be an active member in the Section of Taxation, American Bar Association, where he was the Past Chair of the Employment Taxes Committee.

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Member CA Bar Member Orange County Bar US Tax Court Attorney