The IRS has hosted a marijuana tax event that appears to support legalization

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The tax authority apparently supports the idea of legalized cannabis

Yesterday, the Internal Revenue Service (IRS) hosted a forum, the IRS National Tax Forum panel, with a special focus on tax policy for businesses related to growing industries such as cryptocurrencies and marijuana. A representative of the National Association of Tax Professionals (NATP) was in charge of the seminar’s presentation, which examined important issues, such as tax deductions allowed while marijuana remains an illegal plant in the eyes of federal law. It also explored how marijuana taxes are addressed by the different states where its use is already considered legal.

During the panel, the growing public support for marijuana legalization and the prospects for federal reform, which appears to be on the horizon if the Democrats in the administration make enough effort, were also given greater prominence. A description of the mid-week event states that attendees will learn how to “prepare a tax return for illegal activities” and “identify when virtual currency should be reported as taxable income.”

The target audience for the presentation was tax professionals with a high interest in learning about the cannabis and cryptocurrency spaces. An overview was provided of some of the different financial issues that are unique to the cannabis industry under the umbrella of federal prohibition. The presenter made it clear that even though marijuana has been legalized in some form in many states across the country, businesses cannot deduct standard expenses as in other traditional markets because the plant still has an illicit status under the Controlled Substances Act.

While it is true that the IRS has not advocated for a change in federal cannabis policy, it is an agency that clearly understands the complications created by prohibition and is charged with making it clear to taxpayers what the current rules of the game are.