California Cannabis Businesses Prepare for
Visits from Uncle Sam and Aunt MaryJane
April is a busy month! With just one day left until the national Tax Day, most taxpayers are rushing to file their state and federal income taxes to pay Uncle Sam. As it happens, cannabis businesses will also get a visit from Aunt MaryJane in late April, when they have to file and pay their cannabis taxes.
With All the Excitement Around 4/20, Don’t Forget About 4/30!
As most cannabis businesses prepare for 4/20 sales and celebrations, how many of them are prepared to file their cannabis taxes?
We are fast approaching the end of the inaugural quarter of 2018 post-legalization of cannabis in California. Mark your calendars – California’s 1st quarter cannabis taxes are due April 30, 2018.
This is the first time cannabis businesses will be attempting to file their cannabis excise tax and cultivation tax returns with the State (unless a different reporting period has been implemented for each given taxpayer).
Of course, they also have to figure out how and when to file and pay local cannabis business taxes to county or city tax authorities. With so much at stake, it’s imperative for cannabis businesses to fully comply with state and local cannabis tax filing requirements to avoid audits and payment of imposed penalties and interest.
Did you know that the California cannabis tax law imposes a mandatory 50% penalty for failing to pay the cultivation tax or cannabis excise tax on time? That’s right, a mandatory 50% penalty!
If you get hit by this huge penalty, CDTFA may waive it if it finds that your failure to timely pay your cannabis taxes was due to reasonable cause and circumstances beyond your control, and occurred despite your exercise of ordinary care and absence of willful neglect. This is a very high bar to meet and won’t let you off the hook if you simply forgot, were too busy or didn’t know how to file your taxes.
You Need To File!
Cannabis business owners must meet all of the State and local cannabis tax reporting and remittance requirements to do business.
Understandably, the complicated cannabis tax regimen implemented by the State and local jurisdictions don’t make it easy for cannabis taxpayers who are already burdened by the myriad of cannabis regulations in this industry on top of running a business.
Taxnexus makes cannabis tax compliance easy.
As the premier Transaction-to-Treasury cannabis tax solution, Taxnexus streamlines compliance with state and local tax regimens throughout the cannabis product chain.
Not only does Taxnexus provide real-time one-click situs at the point of sale to calculate and collect the correct cannabis taxes from purchasers, it will also prepare tax reports and automatically file cannabis tax returns.
With Taxnexus, taxpayers no longer have to figure out the when, how, where, and what of cannabis taxes. They can leave taxes to us, and focus on running a profitable cannabis business.