The Other IRS Scandal: Outright War Against Marijuana Dispensaries

[xchrom]

http://www.alternet.org/news-amp-politics/other-irs-scandal-outright-war-against-marijuana-dispensaries



Dispensaries providing marijuana to doctor-approved patients operate in a number of states, but they are under assault by the federal government. SWAT-style raids by the DEA and finger-wagging press conferences by grim-faced federal prosecutors may garner greater attention, but the assault on medical marijuana providers extends to other branches of the government as well, and moves by the Internal Revenue Service (IRS) to eliminate dispensaries' ability to take standard business deduction are another very painful arrow in the federal quiver.

The IRS employs Section 280E, a 1982 addition to the tax code that was a response to a drug dealer's successful effort to claim his yacht, weapons purchases, and even illicit bribes as business expenses. Under 280E, individuals involved in the illicit sale of controlled substances -- including marijuana, even medical marijuana in states where it is legal -- cannot claim standard business expenses on their federal taxes.

"The 280E provision which requires certain businesses to pay taxes on their gross income, as opposed to their net income, is aimed at shutting down illicit drug operations, not state-legal medical marijuana dispensaries," said Kris Hermes, spokesman for the medical marijuana defense group Americans for Safe Access." Nonetheless, the Obama Administration is using Section 280E to push these local and state licensed facilities out of business."

The provision can be used to great effect. Oakland's Harborside Health Center was hit with a $2 million IRS assessment in 2011 after the tax agency employed Section 280E against. Harborside is fighting that assessment, even as it continues to try to fend off federal prosecutors' attempts to shut it down by seizing the properties it leases. Similarly, when the feds raided Richard Lee's Oaksterdam University that same year, it wasn't just DEA, but also IRS agents who stormed the premises. Lee said it was because of a 280E-related audit.

[annabanana]

1. Will this admin. EVER get real on this issue?

Or is big pharma too much of a factor?

[duhneece]

6. How quiet will WE remain?

How many letters, phone calls, speaking up in public, doing all we can imagine ourselves doing...are we putting enough pressure on the Pres, our congress critters?
For me, that's the question.

[rhett o rick]

2. This Admin has their priorities messed up big time. nm

[Dustlawyer]

3. Big Pharma owns Obama!

[marmar]

4. k/r

[xtraxritical]

5. Dispensaries are wise to not have "store fronts" and use "word of mouth".