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Up in Smoke: Alpenglow Botanicals, LLC V. United States

Challenging IRS authority to deny “ordinary and necessary” business expense deductions By Tosin Hassan, CPA, CohnReznick In the words of Lauryn Hill, “It’s funny how money changes a situation, miscommunication leads to complication.” With the explosion of cannabis businesses across the country, many business owners are not profitable because of significant tax bills impacting cannabis […]
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Beware! Are you in compliance with your cash payments?

By Mary Amato, CPA, Partner, CohnReznick It is no secret that the Internal Revenue Service (IRS) is aggressively auditing cannabis businesses. The focus is on more than the limitations placed on the industry by IRC §280E. The IRS aggressively audits non-compliance of Reporting of Cash Payments. Form 8300, is not an income tax reporting form. […]
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Acquisition-Side Due Diligence in The Legal Cannabis Industry: Approach and Expectations for Both Sides

By Greg Chin, Kevin Michaelan and Jeffrey Michelson, Partner Continuing with the topic of industry trends from our last post, we explore the art of acquisition-side due diligence from full-scope financial and tax to limited-scope tax-only engagements.  We’ll look at what to expect and how to approach it.  Although commonly geared toward the investor/acquirer, i.e., […]
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Cost Segregation and Benefits for Real Estate Investors

What We Learned: Operators owning property types which have a tax basis of at least $1 million, and that are subject to depreciation, can qualify for a cost segregation study (CSS). By Derek Weaver, Senior Manager As discussed in December 2017, 280E continues to be a major problem for plant-touching businesses. However, there are several […]
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How to Evaluate Valuations in the Cannabis Marketplace

By Andrew Lines, MAI, Principal What We Have Learned: In valuing the business operations of companies in the cannabis industry, risk is a significant factor that can dampen even the most optimistic outlook and projections. Valuations within the growing cannabis industry don’t always seem to be consistent with operator or investor expectations; this can be […]
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Trump’s Tax Reform: What Operators and Individuals Need to Know?

By Mary Amato, CPA, Partner What We Have Learned: If the introduction of new markets and regulations did not keep lawyers and accountants busy, the new tax laws should.    We have not seen a reform to the tax code as sweeping as the TCJA (Tax Cuts and Jobs Act of 2017) since 1986. As […]
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The Tax Cuts and Jobs Act: Key Considerations for Cannabis Businesses

By Mary Amato, CPA, Partner The Tax Cuts and Jobs Act (“the Act”), signed by President Trump on December 22, 2017, is the most sweeping update to the tax code since 1986. While technical corrections and interpretive guidance issued by the IRS are forthcoming, taxpayers must understand which provisions will affect them and how. Cannabis […]
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Businesses and Individuals are asking, “What does the New Tax Law mean to me?”

By Mary Amato, CPA, Partner We have not seen a reform to the tax code as sweeping as the TCJA (Tax Cuts and Jobs Act of 2017) since 1986.  As with the reform then, there are sure to be technical corrections to the new law and interpretive guidance to be issued by the Internal Revenue […]
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Know the Risks: Valuations in the Cannabis Marketplace

By Andrew Lines, MAI, Principal Valuations within the growing cannabis industry don’t always seem to be consistent with operator or investor expectations; this can be due to lack of available transaction data, or misinterpretation of perceived risks – CohnReznick’s Valuation Advisory group can help identify how these risks should be quantified. With regards to Real […]
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Cost Segregation and Cannabis Business Owned Real Estate

By Derek Weaver, Senior Manager As discussed two weeks ago, 280E continues to be a major problem for plant-touching businesses. However, there are several opportunities to minimize taxes and maximize cash flow for ancillary businesses that serve the cannabis industry. This week we will take a look at cost segregation and the benefits for real […]
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