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(TaxProf)   To avoid taxes, should medical marijuana sellers operate as nonprofits?   (taxprof.typepad.com) divider line 184
    More: Interesting, local taxes, United States Code, nonprofits, income taxes, tax exemption, marijuana sellers  
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3387 clicks; posted to Main » on 04 Mar 2013 at 1:55 PM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-03-04 01:41:59 PM
1.bp.blogspot.com
 
2013-03-04 01:48:02 PM
they *are* doing god's work.
 
2013-03-04 01:50:09 PM
Considering the "legal" prices are the same as the street prices, I'd say someone is making a profit whether they're reporting it or not

/someone needs to investigate price fixing in the market
 
2013-03-04 01:50:40 PM
FFS, pay your farking taxes you sniveling little farks.
 
2013-03-04 01:55:02 PM
To avoid taxes, you should move to Somalia.  Taxes are the entry fee that you pay in order to be allowed to participate in civilization.  Pay up or get out.

"Go Galt" if you think that will work, I don't care, good luck to you, but you've either got to pay your share or give up the benefits of living in a civilized society, no ice cream until you finish your vegetables.
 
2013-03-04 01:55:35 PM

GAT_00: FFS, pay your farking taxes you sniveling little farks.


This.

Jesus Christ, tax-dodging has become our national sport.
 
2013-03-04 01:56:01 PM
You think the Feds are going to legalize a way to literally print money and not tax it?

Wow.

/likes how Tennessee did it. The penalty for getting caught selling pot with a tax stamp is far less than without it.
 
2013-03-04 01:57:34 PM
First, the feds need to legalize MJ and then fix the farking tax codes.
Keeping street prices around the same as they are now isn't a problem since the vast majority of smokers (er... patients) are used to paying that, but if you make it too expensive, you won't kill the black market. OTOH, anti-MJ folks are probably OK with that since they can point to it and claim "ZOMG -Legalization doesn't work"
 
2013-03-04 01:57:59 PM

GAT_00: FFS, pay your farking taxes you sniveling little farks.


If you don't owe taxes they're not your taxes, are they?
 
2013-03-04 01:58:22 PM
Anything medical should be non profit.
 
2013-03-04 01:59:14 PM
Are florists non-profit? No. They are glorified botanists. Pay taxes like everyone else.
 
2013-03-04 02:00:57 PM

modesto: Anything medical should be non profit.


"Medical" marijuana is a different category.
 
2013-03-04 02:02:03 PM
NFL and NCAA are non-profits so why not weed sellers.
 
2013-03-04 02:02:27 PM
The FDA and USA should STFU and just let the medical MJ shops do what they want.
The sooner every one lights up and mellows out, they better it will be for everyone.

And yes, it makes me a bad person, but an painful ass cancer on anyone who would deny medical MJ to one suffering from cancer.
 
2013-03-04 02:02:27 PM

hardinparamedic: You think the Feds are going to legalize a way to literally print money and not tax it?

Wow.

/likes how Tennessee did it. The penalty for getting caught selling pot with a tax stamp is far less than without it.


Literal . . .
affordablehousinginstitute.org
 
2013-03-04 02:02:59 PM

modesto: Anything medical should be non profit.


i like that idea, considering it's a human necessity.
 
2013-03-04 02:04:01 PM

modesto: Anything medical should be non profit.


Ideally, yes. I'd WELCOME a single payer, Government run system like the UK has, mainly for professionally selfish reasons, but otherwise because it would be better for patients as a whole.

That said, I don't think Non-profits work like this person thinks they work. You cannot claim to be a non-profit and make gangbusters without giving Uncle Sam his cut. You have to track and justify where those funds go, and they are public knowledge.
 
2013-03-04 02:04:09 PM
You're going to need a really good tax attorney to argue this with the IRS because they're going to laugh their asses off when they receive your application for 501c3 status.
 
2013-03-04 02:05:53 PM
I wonder how many of the people who are complaining about the mj taxation are the same people who said "Legalize it and tax the hell out of it."?
 
2013-03-04 02:06:28 PM
To avoid taxes? How about to avoid being charged as the kingpin of a profitable grow/distribute operation?
 
2013-03-04 02:07:01 PM

ecmoRandomNumbers: GAT_00: FFS, pay your farking taxes you sniveling little farks.

This.

Jesus Christ, tax-dodging has become our national sport.


Just look at Greece -- the bastion of a no-taxes-paid economy.
 
2013-03-04 02:07:12 PM

MaudlinMutantMollusk: Considering the "legal" prices are the same as the street prices, I'd say someone is making a profit whether they're reporting it or not

/someone needs to investigate price fixing in the market


Here in Northern California the "legal" prices are like double the price as the street prices for the same quality.
 
2013-03-04 02:07:25 PM
Well we let banks and corporations not pay taxes- why not?

/stupid idea all around
 
2013-03-04 02:08:11 PM
I think they're completely missing the point of selling drugs.  In America, we profit from EVERYTHING.
 
2013-03-04 02:08:41 PM

GAT_00: FFS, pay your farking taxes you sniveling little farks.


There is an anti-drug runner law called 280E that basically makes it so that they can't deduct anything as a business expense, including salaries.  Their tax bills are often higher than their total profits because of it.  Not only that, but the credit card companies and banks said they couldn't keep their money with them or have credit card transactions, so all of a sudden all of their transactions went cash only.  It's basically the perfect storm of cutting off the tax spigot that they were paying. In any case, the Californian ones are all supposed to be non-profits but they all got shut down by Federal DAs anyway.
 
2013-03-04 02:08:56 PM
until the fed recognizes marijuana as legal and allows businesses to deduct normal business expenses the MM sector should do what ever it can to minimize it's tax burden.
 
2013-03-04 02:10:06 PM
Sure....but why stop at "medical" marijuana? Let the oil companies become non profits too.
 
2013-03-04 02:10:23 PM
If the NFL can operate as a 501(c)4, I see no problem with this.
 
2013-03-04 02:11:06 PM
I guess no one read TFA, where it talks about a 75% federal tax being at issue.

/tax any business at 75% and it literally becomes a non-profit operation.
 
2013-03-04 02:12:05 PM
It's my understanding that every medical MJ law requires dispensers to operate as non-profits.
 
2013-03-04 02:12:08 PM

kbronsito: they *are* doing god's work.


Somebody has to...
 
2013-03-04 02:12:45 PM

SnakeLee: GAT_00: FFS, pay your farking taxes you sniveling little farks.

There is an anti-drug runner law called 280E that basically makes it so that they can't deduct anything as a business expense, including salaries.  Their tax bills are often higher than their total profits because of it.  Not only that, but the credit card companies and banks said they couldn't keep their money with them or have credit card transactions, so all of a sudden all of their transactions went cash only.  It's basically the perfect storm of cutting off the tax spigot that they were paying. In any case, the Californian ones are all supposed to be non-profits but they all got shut down by Federal DAs anyway.


He doesn't care.

GAT is an authoritarian when it comes to drug laws. He doesn't think any anti-drug policy is too irrational or unfair to punish drug users for their victimless behavior.
 
2013-03-04 02:13:11 PM
Step 3:  Profit?
 
2013-03-04 02:14:13 PM

SnakeLee: so all of a sudden all of their transactions went cash only.


So it's a cash only business but their taxes are higher than their profits?  Someone doesn't understand the basics of "cash only business".
 
2013-03-04 02:14:24 PM

ecmoRandomNumbers: GAT_00: FFS, pay your farking taxes you sniveling little farks.

This.

Jesus Christ, tax-dodging has become our national sport.


You mean acting as a Real American and doing out patriotic duty to use our tax system to our advantage, to help us all prosper as a nation?
 
2013-03-04 02:15:11 PM
In California they're not allowed to sell medical marijuana for "profit" at all. Obviously they're paying their employees and the like, but if they're making huge profits, they're not in compliance with the state law. Now if we can just get the Cali DA to physically shield them from the feds, it'd be cool.

TheXerox: I wonder how many of the people who are complaining about the mj taxation are the same people who said "Legalize it and tax the hell out of it."?


I'm wondering the same thing. I'm one of those "legalize it and tax it" people, but I'm thinking more like the tax we have on booze. I'm not real pleased at the 208 E levels of taxation, especially by an entity that could arrest you after you pay your taxes cuz the reason you're paying those taxes is you are engaged in what they view as a criminal enterprise - even if it is legal in your state.
 
2013-03-04 02:15:42 PM

SnakeLee: GAT_00: FFS, pay your farking taxes you sniveling little farks.

There is an anti-drug runner law called 280E that basically makes it so that they can't deduct anything as a business expense, including salaries.  Their tax bills are often higher than their total profits because of it.  Not only that, but the credit card companies and banks said they couldn't keep their money with them or have credit card transactions, so all of a sudden all of their transactions went cash only.  It's basically the perfect storm of cutting off the tax spigot that they were paying. In any case, the Californian ones are all supposed to be non-profits but they all got shut down by Federal DAs anyway.


They all got shut down by the feds?  When exactly?
 
2013-03-04 02:17:12 PM
If I can grow farking Asprin in my own back yard, they government should STFU and let me enjoy life with out any headaches.
 
2013-03-04 02:17:47 PM

SnakeLee: In any case, the Californian ones are all supposed to be non-profits but they all got shut down by Federal DAs anyway.


Probably because it isn't believable.  I find it unlikely they really were all old-fashioned hippies running those who really were acting as non-profits.  But there's little reason to force them into a cash model like that.  A supposedly medical facility that is cash only?  It's a crock of shiat.  If it's a business, let them act like it.
 
2013-03-04 02:17:52 PM
i41.tinypic.com
 
2013-03-04 02:18:00 PM
Avoid taxes? But there is already a 25% excise tax on the sale between the producer, processor, and retailer!
 
2013-03-04 02:18:51 PM

vudukungfu: If I can grow farking Asprin in my own back yard, they government should STFU and let me enjoy life with out any headaches.


Nice to know that 80 years later, policies steeped in Racism and White Supremacy still permeate through the government in our drug policy.
 
2013-03-04 02:22:04 PM
I believe in many states where medical weed is legal, it all HAS to be non profit.

I think some law maker didn't know what non-profit meant.
 
2013-03-04 02:23:11 PM
Avoid taxes?  Wtf?  I thought part of the reason the red-eyed, dorito munching pot smokers were saying weed should be legalized was to tax it and that it would "solve the defecit"...

Now they're complaining about taxes?  WTH???

Do you want higher priced pot, or to go to prison.  Stoners are never happy.  Jeez.
 
2013-03-04 02:23:37 PM

BarkingUnicorn: It's my understanding that every medical MJ law requires dispensers to operate as non-profits.


Barking unicorn is correct.
But what is really sad is the brain washed masses who want to pay more taxes. On anything really.
Read the new freedom by W Wilson.
We got screwed 100 years ago.
Hell even 20 years ago nobody wanted more taxes.
Giving the government more money is like
It's like giving a child another gun.

Pots Great! Now tax my vegetable garden.
 
2013-03-04 02:24:06 PM
Holy crap, did nobody RTFA? It's not about paying taxes, it's about controlled substance federal tax laws not allowing operating expenses to be deducted from gross income. The rest of the country pays taxes on net profit, but the MMJ industry is required to pay taxes on GROSS profits. This could result in the tax bill being higher than your net profit. Simply outrageous.

Additionally, to address other comments: Yes, it's a weed. And yes, getting it to grow and flower to produce  personal quantity of decent product is easy. But getting efficiently growing commercial quantities of GREAT product is NOT easy, or more correctly, is not cheap. If you can't subtract your costs for space, power, and labor from your gross profits due to some heavy-handed, and out-dated federal tax code, it will not be a for-profit business.

This is not about paying taxes, it is about being able to operate a profitable business.

/Farking, fark..
 
2013-03-04 02:24:25 PM

BafflerMeal: SnakeLee: GAT_00: FFS, pay your farking taxes you sniveling little farks.

There is an anti-drug runner law called 280E that basically makes it so that they can't deduct anything as a business expense, including salaries.  Their tax bills are often higher than their total profits because of it.  Not only that, but the credit card companies and banks said they couldn't keep their money with them or have credit card transactions, so all of a sudden all of their transactions went cash only.  It's basically the perfect storm of cutting off the tax spigot that they were paying. In any case, the Californian ones are all supposed to be non-profits but they all got shut down by Federal DAs anyway.

They all got shut down by the feds?  When exactly?


We still have 'em, we were just a bit thin on 'em for a while. Some of the growers were arrested by the feds, including two of the major growers/distributors out of San Francisco. That was quite some time ago, pre-Obama era, and I'm not sure how that case turned out. I got distracted by other news and since I'm not a pot smoker, I didn't keep track of the names of the dispensaries and growers involved.

/used to live by one
//good neighbors cuz they were way chill
 
2013-03-04 02:24:39 PM
No.
 
2013-03-04 02:26:01 PM

ecmoRandomNumbers: GAT_00: FFS, pay your farking taxes you sniveling little farks.

This.

Jesus Christ, tax-dodging has become our national sport.


Long ago, John Maynard Keynes said, "The avoidance of taxes is the only intellectual pursuit that still carries any reward."

The author of TFA is nuts if he thinks a "social welfare organization" that promotes social welfare by breaking federal law will ever get federal nonprofit status.  Christ, what an asshole!
 
2013-03-04 02:26:36 PM
Without reading the article, I don't think they legally can operate as nonprofits. They produce and sell a product for monetary gain. I know when we send out letters to people who contribute to write off the taxes, we need to make sure that we mention that no goods or services were provided. The only other money we get comes from the government or grants from other nonprofits.
 
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