Handling Cannabis Tax Examinations: Sec. 280E, Audits, IRS Guidance, Reporting Requirements

A live 90-minute premium CLE/CPE video webinar with interactive Q&A

Wednesday, March 24, 2021

1:00pm-2:30pm EDT, 10:00am-11:30am PDT

Early Registration Discount Deadline, Friday, February 26, 2021

or call 1-800-926-7926

This CLE/CPE webinar will provide tax counsel and advisers guidance on effective methods in handling IRS cannabis tax examinations for businesses engaged in the cannabis industry. The panel will discuss key federal and select state tax law provisions impacting marijuana businesses, key items of focus by the IRS when examining cannabis operations, and techniques in managing audits.


The sale and distribution of cannabis for recreational or medical use is a powerful economic engine generating billions in annual revenue, with over 40 states and the District of Columbia having some form of legalization of the substance. Despite state relaxation of marijuana prohibition laws, without careful planning, regulated cannabis businesses can be subject to hefty tax assessments and penalties.

Under Section 61, all gross income must be reported from whatever source it is derived. However, under Section 280E, cannabis businesses cannot deduct rent, wages, and other expenses unless it is for cost of goods sold (COGS), resulting in a substantially higher tax rate than other companies on their income. The IRS issued guidance to its agents on conducting audits of cannabis businesses giving IRS agents the authority to change a cannabis business' accounting method. Under Section 280E, certain costs are not included in COGS. Thus, they remain non-deductible for income tax purposes.

As more states legalize cannabis and make available licenses to grow, manufacture, distribute, and sell cannabis, the IRS has increased cannabis tax audits, which could result in unbearable tax liabilities.

Listen as our panel discusses federal and select state tax law provisions impacting cannabis businesses, key items of focus by the IRS when examining cannabis operations, and tactics for managing audits.



  1. Federal and state tax law issues for cannabis businesses
  2. Key planning strategies to minimize tax liability and avoid audits
    1. Section 280E
    2. Ownership structures
    3. Deductions
  3. Navigating IRS examinations of cannabis businesses


The panel will review these and other key issues:

  • Federal and select state tax law provisions impacting cannabis businesses
  • Application of tax rules to the cannabis industry and key planning techniques
  • Key issues raised and techniques in handling IRS examinations
  • Effect of Section 280E and deduction of the cost of goods sold


Kalinski, Jonathan
Jonathan Kalinski

Hochman Salkin Toscher Perez

Mr. Kalinski specializes in both civil and criminal tax controversies as well as sensitive tax matters including...  |  Read More

Stein, Michel
Michel R. Stein

Hochman Salkin Toscher Perez

Mr. Stein specializes in tax controversies, as well as tax planning for individuals, businesses and corporations. For...  |  Read More

Toscher, Steven
Steven (Steve) Toscher

Hochman Salkin Toscher Perez

Mr. Toscher has been representing clients for more than 35 years before the Internal Revenue Service, the Tax Divisions...  |  Read More

Live Webinar

Buy Live Webinar
Early Discount (through 02/26/21)

See NASBA details.

Live Webinar


Buy Live Webinar & Recording
Includes special savings of $300 (through 02/26/21)

Live Webinar & Download


Live Webinar & DVD

$394 + $24.45 S&H

Other Formats
— Anytime, Anywhere

Early Discount (through 02/26/21)

Strafford will process CLE credit for one person on each recording. All formats include program handouts. To find out which recorded format will provide the best CLE option, select your state:

CLE On-Demand Video

48 hours after event



48 hours after event

CPE Not Available



10 business days after event

CPE Not Available

$297 + $24.45 S&H