Memorial Day is just around the corner, which means it’s nearly patio, pool and monsoon rain season. I’m sure everyone is looking forward to a long weekend, but let’s take a moment to look back for a moment. Did you catch SFR’s cannabis issue last month?
Not to dwell too much on the past, but last month I also reported on a funny little thing the feds do with cannabis businesses when it comes time to pay yearly taxes. A tax law, known mostly to only those in the cannabis industry, requires weed business owners to pay taxes on nearly all of their revenue, making things a whole lot more expensive compared to traditional businesses.
Thanks to a decades-old tax case, the IRS limits cannabis business deductions to the cost of production or purchase of wholesale weed. That could mean trouble for retail-only spots.
Death by Deduction
New pot shops learn about federal weed tax laws the hard way
Congress approved the restrictions in the early 1980s after Minnesota resident Jeffrey Edmondson was busted for selling cannabis, among other drugs about a decade prior. Edmondson successfully argued in tax court that a portion of his rent, his phone bill and travel expenses were all deductible, leading federal lawmakers to swoop in and make it illegal to write off the costs of selling illegal substances.
I caught up with one of Edmondson’s lawyers after SFR published my last story about the tax law. Saul Bernick tells me he and his partner had only recently opened their tax law-firm when the took Edmondson’s case to court.
“Jeff was really good looking,” Bernick says. “I don’t even know if he was 18, 19, or 20, I can’t remember. He was a baby faced kid and probably sold to all the young girls and all the young guys around and had a little following.”
Bernick says Edmondson’s meticulous record keeping impressed the court, but the result was an “irate” Congress that quickly changed the law.
Running out of patients
Some readers might remember a few years back when patients and patient advocates warned that the medical cannabis would suffer after full legalization. There’s no immediate sign of the state’s medical program folding, but the number of patients have steadily declined since adult-use sales began last April and state officials expect a further decline before things level out.
Going the Way of the Card
The number of medical cannabis patients in New Mexico has steadily declined since last year and it’s not likely to rebound
I learned a few weeks ago that there’s a dispensary in Albuquerque that hosts a yoga class that includes puffing on a pre-roll before stretching.
Nia Harris, owner of Herban Oasis Apothecary, says the yoga classes are just one example of activities that she’s got going on down there. Give this month’s Leaf Brief Podcast a listen to hear about other activities the dispensary offers and why yoga might be the most logical thing to do after sparking up.
Leaf Brief Podcast: Episode 5
Yoga and cannabis merge for a pilot consumption-area venture
Shake: Odds and ends from New Mexico and beyond
- The New Mexico Department of Health approved insomnia as the latest condition to qualify for a medical cannabis card.
- In “no one should be surprised” news, a number of folks are still having trouble getting their old weed charges and convictions expunged, according to this story from the Albuquerque Journal.
- There’s a new product called Undoo out there for those times you really regret taking that extra hit or bit of that special cookie. According to the product’s website, there is also an option for the general fogginess that comes hours after smoking. What a time to be alive.
- Many in the California and Colorado cannabis industries are straight-up not having a good time, apparently. A perfect storm of over-supply, more states legalizing and dropping prices indicate the green rush is slowing to a green stroll.
- The Land of 10,000 Lakes is set to be the latest state to legalize recreational-use cannabis. I’m guessing, “Ope, this is cashed,” is going to be heard a lot more in the near future.
- In New York City, toking drivers are commonplace, but impaired driving enforcement is not.
Word on the street
Keep an eye out for new stickers on packages while you’re shopping for cannabis. The state’s Cannabis Control Division in April started offering microbusinesses a special designation for their products as a way to “help consumers identify and purchase products sourced from small New Mexico businesses.” Not too shabby? Read more about how small businesses are finding their way in this story from the 2023 SFR Cannabis Guide.