Oakland medical cannabis club owes IRS millions in back taxes

[court jester]

"The Internal Revenue Service has ordered Oakland's Harborside Health Center, the largest medical cannabis dispensary on the West Coast, to pay $2 million in taxes after ruling that the collective cannot deduct standard business expenses, such as payroll and rent.

...The agency based the decision on the fact that Harborside provides medical cannabis, a substance that while permitted in California is still illegal under federal laws.

The IRS ruling further complicates Oakland's pursuit of more tax dollars from large-scale marijuana cultivation for medicinal purposes. It also has DeAngelo worried about the future of his dispensary, which opened in 2007. Harborside might not be around to pay next year's taxes if the federal government continues to tighten the noose around the medicinal cannabis industry, he said.

The IRS is auditing more than a dozen other dispensaries in California, and banks are refusing to do business with dispensaries for fear federal regulators will prosecute them.

http://www.mercurynews.com/ci_19039930?IADID=Search-www.mercurynews.com-www.mercurynews.com

Bye Bye Dispensaries



Candidate Barack Obama on August 21, 2007:

http://youtu.be/GUze-oYsswI

[YellowCosmicSun]

1. They're not going to roll back the green tide. Not even close.

[Politicalboi]

2. That's our government

The Feds want back taxes for something they deem illegal. So aren't they breaking the law by accepting illegal tax money? LOL! They should only have to deal with state tax. Fuck the Feds. And now the banks are worried about being prosecuted. :crazy:

[kelly1mm]

3. Income, even from illegal activities, is taxable. Ask Al Capone. This

is not about them paying 'regular' federal taxes on profits like other businesses (income - expenses = profit that is taxed). The IRS is disallowing the vast majority of their expenses like rent, payroll, utilities etc. as legitimate expenses as they claim the activity is illegal pursuant to federal law (which it is).

Another tact they are now taking is going after landlords for the dispensaries. That will put them out of business faster than anything else.

[court jester]

5. Exactly-If this fine stands, & the IRS levies fines against some other High Visibility dispensaries

which is obviously going to happen-
it's the end of dispensaries. At least for the next few years.

This is big news.

[Bluenorthwest]

4. If Obama wants West Coast electoral votes he will have to deal

with the facts of this. He spouted what turn out to be utter and total fountains of bullshit. This will not go over well here.
It is particularly galling because of Obama's recent proclamation that civil rights for gay people should be left up to the States as a matter of State's rights. So the states should decide about human rights, he says, but they should not have the power to let chemo patients have medicine they do not approve of down at the Mega Church.