Monday, February 16, 2015

No easy answer to cash and cannabis

Posted By on Mon, Feb 16, 2015 at 5:30 PM

click to enlarge DOUG SHUTTER/SHUTTERSTOCK
  • Doug Shutter/SHUTTERSTOCK
Back in December, Casey Wooten of the IRS' Office of Professional Responsibility noted in a press release that Sen. Michael Bennet (D-CO) and Rep. Ed Perlmutter (D-CO) asked the IRS to waive fees for marijuana businesses paying withholdings in cash. On Monday, Feb. 16, the IRS responded with what amounts to a big, greasy middle finger. 

Here's the back story: Allgreens, a medical dispensary in Denver, lost its bank account in 2012. The IRS has since been fining them for paying their withholdings in cash. Last year, Allgreens filed a petition to get the fines waived.

Here's what the IRS told them: If a company “cannot secure a bank account due to current banking laws, (it) is not considered reasonable cause to abate the penalty,” according to a Denver Post article. That said, the IRS has previously provided Allgreens an alternative — essentially, find someone else to take the money and pay on Allgreens' behalf. Allgreens' attorney advised them against said alternative, calling it "a potentially unlawful activity" and "the very definition of money laundering," according to the Post.

Cannabicare owner Julie Sveinsson didn't know about the decision when the Independent called for her thoughts. She hires a payroll company to take care of her payroll taxes.

"All of my taxes are already taken out of my employees' paychecks," she says. "Everything gets pulled out."

When asked for the name of her payroll company, she refused, saying, "Oh, hell no ... They could lose their banking if they have too many marijuana stores."

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