Service Solutions | 9.27.22 | The Devil is in the Details: Claiming Your Employee Retention Credit as a Cannabis Business
NCIA’s Service Solutions series is our sponsored content webinar program which allows business owners the opportunity to learn more about premier products, services and industry solutions directly from our network of established suppliers, providers and thought leaders.
In this edition originally aired on Tuesday, September 27, 2022 we were joined by the experts from ERT Credit for an exclusive webinar outlining how cannabis businesses can take advantage of The Employee Tax Credit (or ERC) which has currently only been claimed by a small fraction of cannabis businesses, and most importantly, as a payroll tax credit is not subject to Section 280E.
Think your cannabis-related business does not qualify for COVID-19 relief funds worth up to $26,000 per employee.? You’ll leave the session with a roadmap for next steps to determine eligibility and maximize your claim so you don’t miss out on a potentially guaranteed refund worth hundreds of thousands of dollars and in some cases millions.
At the conclusion of the discussion our panel hosted a moderated Q&A session to provide NCIA members an opportunity to interact with leading minds from the cannabis accounting and technology space, join today to contribute to future conversations!
40:46 – Audience Q&A (If your business is still operating – what are the taxes due on the tax credit?)
42:04 – Audience Q&A (I was told that ERC money is not available for the cannabis industry due to 280e. How are you navigating that compared to others trying to provide the same services?)
44:31 – Audience Q&A (Does this apply to cultivation facilities also?)
46:42 – Audience Q&A (What if we apply and don’t receive our money or we are denied the credit?)
48:09 – Audience Q&A (What if my accountant/lawyer says I don’t qualify?)
49:41 – Audience Q&A (How can I find more details on how to navigate the 280e concerns?)
50:58 – Audience Q&A (So if you went out of business before or soon after getting the tax credit you would not have any (or minimal) tax impact from taking the tax credit?)
53:24 – Audience Q&A (Do I have to spend the money on my payroll? Or can I use it towards my other business expenses? Any other restrictions?) 54:26 – Audience Q&A (So is this a credit for my company towards next year or do I get an actual check like a refund?)
01:05:28 – NCIA Lobby Days 2023 Member Appreciation
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MORE Act Headed For Vote, SAFE Banking Still In Play
by Morgan Fox, NCIA’s Director of Media Relations
We asked, you answered, and your efforts are seeing results!
Over the past months, our Government Relations team in Washington, D.C. has been hard at work gathering support in Congress for the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act, and many of our members responded to the call to contact their lawmakers to urge them to support the legislation and bring it to a floor vote in the House. Well, our mutual work is paying off!
Last week, House Majority Whip James Clyburn (D-SC) announced that the MORE Act would be called for the vote! This was confirmed Monday as taking place during the week of September 21.
This legislation would remove cannabis from the Controlled Substances Act and do away with the continuing conflict between states with modern cannabis laws and the federal government. It would also expunge federal cannabis convictions, remove barriers to research, eliminate the current problems with the 280E tax code and lack of access to banking, promote more diverse participation in the cannabis industry, and establish funds to help undo the disparate harms caused by prohibition.
Make no mistake: this vote will be historic. This will be the first time that a bill to end cannabis prohibition has come up for a full vote in either chamber of Congress, and the results of the vote could determine the path of cannabis policy reform efforts for years to come.
This means we have just three weeks to drum up as much support as possible and show our elected officials where the vast majority of Americans stand on cannabis.
If your representatives are not among the 87 current cosponsors of the MORE Act, please contact them and urge them to join in showing their support for this momentous and necessary bill.
Meanwhile, our efforts to maintain momentum for cannabis banking reform have continued throughout the negotiations of the next pandemic relief bill. Despite a somewhat contentious public debate over the size and scope of the stimulus funds in general, hope is still alive for the SAFE Banking Act provision to be included in the final legislation if Congress can come to some agreements on the numerous other issues at stake.
What is not up for debate is that SAFE Banking is an absolutely necessary part of COVID-19 relief. This measure will improve public health and safety by enabling more social distancing and decreasing cannabis businesses’ reliance on cash transactions which can spread contagions and make them a target for crime. Most importantly, it will help thousands of small businesses – with hundreds of thousands of employees across the country – survive these difficult times while providing uninterrupted healthcare services. It doesn’t get more COVID-relevant than that.
While it is still uncertain when or how the House and Senate will arrive at a compromise for pandemic relief, we don’t have much time before the elections divert most of their attention.
Keep an eye out for updates on ways you can help get SAFE Banking passed this year.
We couldn’t do this work without the support and assistance of our valued members. If you are not yet a member, please support our work byjoining today. If you already are a member, thank you for making our advocacy work possible.
Member Blog: A COVID-19 Guide For Cannabis Entities
As the fallout from COVID-19 ripples through the economy, cannabis businesses are once again faced with a plethora of conflicting information and uncertainty. As counsel to the NCIA and in service to its membership, Wykowski Law has put together a guide to the most common issues facing cannabis businesses in the wake of COVID-19. The guide focuses on national issues and focuses in on some issues specific to California.
Please check out the guide for more details, but here is a quick rundown of what you need to know as a cannabis business in the age of COVID-19:
As we’ve unfortunately become accustomed to, cannabis has largely been left out of relief efforts, particularly where the federal government is concerned. Like with anything cannabis, this means that we have to dig deeper and be more creative to survive.
What sort of help can cannabis businesses get from SBA, PPP, and EIDL? Are there alternatives?
Generally, the Feds are not going to let MRBs touch these funds. But don’t despair. There are potential alternatives at the state level (in California at least) including CalCAP, IBank, and JSLP. Of course, these programs present their own challenges for MRBs, but they do not categorically rule out lending to the cannabis industry.
What about taxes and tax relief?
Unfortunately, when it comes to the Feds we continue to live under the spectre of 280E which makes so many of the tax credits and relief potentially unavailable. There may be some strategies to take advantage of some of these programs, but they are largely dependent on your individual situation. Check with your tax expert!
Some of these regulations just aren’t practical during a pandemic. Are we really expected to comply?
There’s good news and bad news on that front. In California regulatory agencies are making some allowances including regulatory variances and allowing curbside pickups. But you have to get approval. Double (and triple) check what sort of regulatory relief your state is offering before deviating from any SOPs.
The bad news is that as an essential service in the age of COVID-19, many cannabis businesses are subject to additional health and safety requirements. California OSHA for instance has put out stricter standards for all businesses and we expect there might be more to come due to the nature of cannabis.
Times are tough, but not hopeless. And, all of the above is just the tip of the iceberg. The full guide goes into deeper detail. Of course, the information you obtain here and in the linked guide is meant to be informational only and is not, nor is it intended to be, advice legal or otherwise. For that you will need to talk to your lawyer and/or accountant.
Henry Wykowski is the founder of Wykowski Law a national cannabis law firm based in San Francisco that has represented the industry since its inception and successfully defended it in multiple landmark cases.
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