Congressmember Andrew Clyde (R-GA) has joined as a sponsor to federal legislation that would prevent marijuana businesses from accessing standard tax deductions, even if marijuana is rescheduled.
With Rep. Clyde joining as a sponsor, House Bill 1447, filed last month by Representative Jodey Arrington (R-TX), now has 10 sponsors. The legislation would amend the Internal Revenue Code to ensure that marijuana businesses remain unable to deduct common expenses such as rent and payroll, even if the Drug Enforcement Administration (DEA) moves marijuana to a lower schedule.
Under current law, Section 280E of the tax code prohibits businesses associated with Schedule I or II substances from claiming tax deductions. If marijuana were rescheduled to Schedule III, that restriction would typically be lifted, providing financial relief to cannabis businesses. Arrington’s bill seeks to prevent that change, maintaining the tax burden regardless of rescheduling.
A companion bill, Senate Bill 471, was introduced in the Senate last month and has two cosponsors, bringing the total number of congressional sponsors to 12.
This proposal comes as the DEA’s rescheduling process remains stalled, with administrative hearings that were originally set to begin in January now canceled, adding further uncertainty to marijuana’s federal status.
At present, no other marijuana-related bill in the U.S. Congress this session has garnered more than a single sponsor.
