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President Donald Trump's executive order directs agencies to begin moving marijuana from Schedule 1 to Schedule III of the Controlled Substances Act.
Here are key things that business owners and individuals need to know:
- Reclassification: What does it mean?
The executive order and reclassification does not legalize cannabis on a federal level, and the Controlled Substances Act remains applicable to recreational marijuana consumption and/or distribution. However, a reclassification acknowledges that there is therapeutic value provided by medical marijuana and provides easier pathways for evidenced-based research. - Tax Benefits for Cannabis Businesses
The order removes cannabis from the definition of businesses engaged in "trafficking" under IRS code 280E. As a result, state-licensed marijuana businesses and investors will be able to claim standard federal tax deductions that were previously unavailable. - Improved Access to Financial Institutions and Operating
Capital
With the rescheduling, cannabis companies are expected to find it easier to establish banking relationships with institutional lenders, opening up avenues for capital infusions and merger/acquisition activity. - Expanded Access to CBD for Medicare Recipients
The directive includes a proposal to allow Medicare recipients to obtain non-intoxicating, full-spectrum CBD products covered under federal health insurance plans. - Encouraging State Reform via Adoption of Medical
Marijuana
The reclassification is likely to encourage hold out states to consider the development of in-state programs for medical marijuana and could also encourage states with existing medical marijuana programs to consider broadening to recreational use or more patient-friendly regulations.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
