Marijuana dealers hit by taxes, complain loudly

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Bateluer

Bateluer

Lifer
Jun 23, 2001
27,730
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http://money.cnn.com/2013/02/25/smallbusiness/marijuana-tax/index.html?iid=GM

Khalatbari said Denver Relief does just over $1 million a year in sales, and that not being able to take some standard business deductions costs him tens of thousands of dollars annually. He estimates his effective federal tax rate is about 50%.

For Denver Relief -- one of the largest marijuana dispensaries in Colorado, with a full-time staff of 15 -- the burden isn't killing the business. But for others, it's been lethal.

Jim Marty, an accountant in Colorado specializing in medicinal marijuana tax law, said he has one client that didn't turn a profit in 2009, 2010 or 2011. In 2012, though, she was handed a $300,000 tax bill from the IRS for those three proceeding years.
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Seems high, with rates hitting 75%. But most taxes are high, even for a private citizen like myself, its ~50%.

But, seriously? The biggest argument to legalize weed is that it can be taxed to augment bankrupt public coffers. Were they really so naive so as to believe they wouldn't be taxed? Idiots.
 
EagleKeeper

EagleKeeper

Discussion Club Moderator<br>Elite Member
Staff member
Oct 30, 2000
42,589
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you mean that the dealers can not pass the taxes along to the customers
 
Matt1970

Matt1970

Lifer
Mar 19, 2007
12,320
3
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GoPackGo said:
Why can't they take "some standard business deductions"?
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As the IRS is concerned it is an illegal business and you cannot write off expenses in an illegal business.

Enacted in the wake of that PR debacle, the rule bars those selling illegal substances from deducting related expenses on their federal income taxes.
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Hugo Drax

Hugo Drax

Diamond Member
Nov 20, 2011
5,647
47
91
Structure it as a Church. Like the Ethiopian Zion Coptic Church.

Shit if The Catholic church can commit pedophilia and get a tax break, a little weed should get a tax break as well.
 
D

Darwin333

Lifer
Dec 11, 2006
19,946
2,329
126
Bateluer said:
http://money.cnn.com/2013/02/25/smallbusiness/marijuana-tax/index.html?iid=GM



Seems high, with rates hitting 75%. But most taxes are high, even for a private citizen like myself, its ~50%.

But, seriously? The biggest argument to legalize weed is that it can be taxed to augment bankrupt public coffers. Were they really so naive so as to believe they wouldn't be taxed? Idiots.
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Normally people bitching about taxes wouldn't even be newsworthy but it seems they have a valid gripe.

I don't know why you would call anyone an idiot for simply wanting a level playing field. Other businesses rightly get to deduct business expenses which has a HUGE impact on how much taxes you owe. A ton of companies would quite literally be bankrupted if they couldn't deduct normal business expenses from their taxes, why are they "idiots" for wanting to pay taxes like every other business?
 
D

Darwin333

Lifer
Dec 11, 2006
19,946
2,329
126
Matt1970 said:
As the IRS is concerned it is an illegal business and you cannot write off expenses in an illegal business.
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Yet its illegal if you don't file and pay taxes on said illegal business.....

The way I see it, legal or not, we want people to pay taxes so doing bullshit like this is counter productive.
 
P

PokerGuy

Lifer
Jul 2, 2005
13,650
201
101
Darwin333 said:
Other businesses rightly get to deduct business expenses which has a HUGE impact on how much taxes you owe.
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To clarify, that should read "other legal businesses rightly...."

People whine that they can't legally deduct expenses of their criminal enterprise?? :D

What's next, bank robbers claiming the expense of buying a gun as a business expense?
 
Matt1970

Matt1970

Lifer
Mar 19, 2007
12,320
3
0
I wonder how many people went into that business thinking they could write off normal items only to find out at the end of the year the small profit they thought they made was now tens of thousands of taxes owed. Every dime you pay out for rent, heat/ac, electric, supplies, employee salaries, furnishings all still gets taxed. You would be lucky to turn dime one in profit.
 
kage69

kage69

Lifer
Jul 17, 2003
29,249
41,394
136
Hugo Drax said:
Structure it as a Church. Like the Ethiopian Zion Coptic Church.

Shit if The Catholic church can commit pedophilia and get a tax break, a little weed should get a tax break as well.
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Why are you so anti-religion?
 
JEDIYoda

JEDIYoda

Lifer
Jul 13, 2005
33,986
3,320
126
How does that affect me?
I have to pay my taxes they should too!
No pity found here.....
 
N

nehalem256

Lifer
Apr 13, 2012
15,669
8
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Matt1970 said:
I wonder how many people went into that business thinking they could write off normal items only to find out at the end of the year the small profit they thought they made was now tens of thousands of taxes owed. Every dime you pay out for rent, heat/ac, electric, supplies, employee salaries, furnishings all still gets taxed. You would be lucky to turn dime one in profit.
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So basically they are being treated the way liberals wish they could treat all businesses?

I mean individuals cannot write those things off, so why should businesses be able to :D
 
JEDIYoda

JEDIYoda

Lifer
Jul 13, 2005
33,986
3,320
126
Hugo Drax said:
Structure it as a Church. Like the Ethiopian Zion Coptic Church.

Shit if The Catholic church can commit pedophilia and get a tax break, a little weed should get a tax break as well.
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You are really really way off beat.....

Did the whole Catholic church commit pedophilia?
Are all members guilty of pedophilia?
Are all catholic clergy guilty of pedophilia?

So a few priests are guilty of these crimes...that has nothing to do with the Catholic churches tax status......

Why are you being such a misinformed bloviator?
 
Matt1970

Matt1970

Lifer
Mar 19, 2007
12,320
3
0
JEDIYoda said:
How does that affect me?
I have to pay my taxes they should too!
No pity found here.....
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It's different with a business. They buy something for $100, sell it for $150 they only pay tax on the $50 they made. With a business like this they are paying tax on $150 which is more than they made in profit.
 
G

Genx87

Lifer
Apr 8, 2002
41,091
513
126
Londo_Jowo said:
Imagine that, the IRS doesn't allow business deductions from a business that's not recognized as being legitimate by federal law.
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Yet they dont seem to have a problem collecting taxes from said business. Imagine that...
 
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