Just three days after its introduction a New York bill to allow marijuana businesses to take standard state tax deductions has been passed by the full Senate.
Senate Bill 7508, filed by Senator Luis Sepulveda, has now been sent to the state Assembly. Passage in the Assembly would put the measure before Governor Kathy Hochul.
If passed into law, SB 7508 would alter the state’s existing tax code to allow marijuana businesses to take deductions for an amount equal to the deductions that were disallowed under Section 280E of the Internal Revenue Code for the taxable year. Section 280E explicitly disallows businesses that are illegal under federal law, even if they’re legal under state law, from taking standard tax deductions.
The text of SB 7508 states:
“For businesses authorized pursuant to the cannabis law to engage in the sale, production, or distribution of (A) adult-use cannabis products, as defined in article twenty-C of the tax law, or (B) medical cannabis, as defined in section three of the cannabis law, the amount of any federal deduction disallowed pursuant to section two hundred eighty-E of the internal revenue code related to the sale, production, or distribution of such adult-use cannabis products or such medical cannabis not used as the basis for any other tax deduction, exemption, or credit and not otherwise required to be added back by subdivision (b) of this section in computing entire net income.”
The full text of SB 7508 can be found by clicking here.
