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Michelle Rutter Friberg (courtesy photo)
Section 280E isn’t just unfair — it’s a small-business car crusher.
This decades-old provision of the federal tax code was created in the 1980s to stop illegal drug traffickers from writing off their expenses. But today, it’s being used against licensed, state-legal cannabis businesses that play by the rules. Unlike every other small business in America, cannabis operators can’t deduct the ordinary costs of running a company — things like rent, utilities, payroll, insurance, or marketing. They can only subtract the cost of goods sold, leaving them with punishingly high tax bills.
The National Cannabis Industry Association (NCIA) recently published a white paper, Leveling the Playing Field: The Case for 280E Reform and Retroactive Relief, detailing the devastating consequences of
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