The New York Senate has approved a bill that would provide tax relief to New York City marijuana businesses that are currently blocked from making federal deductions under an Internal Revenue Service (IRS) code known as 280E.
While Gov. Kathy Hochul (D) signed a budget bill last year that included provisions allow state-level cannabis business tax deductions—a partial remedy to the ongoing federal issue—New York City has its own tax laws that weren’t affected by that change.
Now the Senate has passed legislation from Sen. Luis R. Sepúlveda (D) to fill that policy gap, voting 43-18 on Monday to send the local reform fix to the Assembly for consideration.
“This bill would allow a deduction for business expenses, incurred by taxpayers authorized by the Cannabis Law to engage in the sale, distribution, or production of adult-use cannabis products or medical cannabis, for purposes of the unincorporated business tax (UBT), the general corporation tax (GCT), and the corporate tax of 2015, commonly referred to as the business corporation tax (BCT),” a summary says.
A section of the city’s tax code would be amended to add sections allowing the deductions “in an amount equal to any federal deduction disallowed by section 280E
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