How Does Caregiver Income Get Taxed?

[Mememe]

There are already attorneys in Lansing trying to take this away from us and give it to professional greenhouses and one of their main points/reasons is that CG will not/are not filing taxes. Maybe claim it as unearned income?

[Dlo]

WOW, nice opinions. Dont pay taxes. Good one, even better coming from non caregivers.

Show me one case were some one was arrested for paying taxes on medical marijuana. It has been legal in CA since 1996. 15 states and D.C.

Am I to beleve that anyone that had made a dollar off it has paid nothing in taxes,or the ones that do are the ones in trouble.(maybe its out there, I cant find it.)

 

Mr.Wilson

"You get audited and are sitting in front of Mr. IRS man. Do you really think, he won't be able to find out that you are making income off marijuana?"

 

Despenceries have absolutely been audited, didnt know that when that happens the feds will automatically come and take you to club fed.(Im sure they know what they're doing)

 

Goggle "How does a caregiver pay taxes."It will bring you right here, to people saying, "anybody whp claims income from being a CG is fuxing HIGH on CHRONIC. ..."looks pretty bad. If thats the consensus with caregivers here(which im sure its not) ,maybe we should work on the message.

 

I not tring to say this is how you have to do it,but I find it hard to belive that the feds are going after the people that are trying to do the right thing, paying their taxes.

 

As far as"If a caregiver is a TRUE compassionate caregiver that doesnt rape people on price"No one is talking about raping people on prices.

 

 

and

Good advise, hey you got any swamp land for sale?

 

You forgot to say you would try and keep in touch,,they dont let you call collect from jail,,,Unfortunatly my friend I know this from real life, 3 times since becoming legal!

 

Phaquetoo

You say you have been in trouble three time since becoming legal,but your all over this site asking a caregiver that wants your right to be illegal right off the bat.Good luck with that.No ill will to you, but #4 may be in your future. "

" I expect 6 ZIPS the day we mail in the forms, and If i want more than a zip a month, I want it for 150 a zip PERIOD!

and if in 6 months you want to keep being my c.g and your meds are topshelf, I will keep you if you come and give me 6 more zips for the following 6 months!"

 

 

I guess Ill be the test case for this one and pay my taxes.

 

 

Sorry about the grammer Im no english major.

[ScrogBubbles]

anybody whp claims income from being a CG is fuxing HIGH on CHRONIC. Cash money ...no trace. No place to find it..

 

Last I checked we were patients and compassionate caregivers. Not criminals. You are hurting our cause when you act like an idiot.

[JMMMBA]

I'm not an accountant, but I did stay at a Holiday Inn last night. If you don't pay your taxes, it is only a matter of time before "the man" will catch up to you. There are good ways and bad ways of going about claiming your income. Contacting an accountant would be an excellent way to find out a good way to pay your taxes and stay under the radar.

[Hempcheff]

I just wanted to throw this in:

 

(e) A registered primary caregiver may receive compensation for costs associated with assisting a registered qualifying patient in the medical use of marihuana. Any such compensation shall not constitute the sale of controlled substances.

 

ok, since the law doesnt regard it as the sale of goods, how is it we can tax/be taxed on it from a business sense? since we would have to record sales in order to maintain accounting records, wouldnt sales be zero, since medical use is nullified as a sale by the MMMact?

 

[phaquetoo]

WOW, nice opinions. Dont pay taxes. Good one, even better coming from non caregivers.

Show me one case were some one was arrested for paying taxes on medical marijuana. It has been legal in CA since 1996. 15 states and D.C.

Am I to beleve that anyone that had made a dollar off it has paid nothing in taxes,or the ones that do are the ones in trouble.(maybe its out there, I cant find it.)

 

Mr.Wilson

"You get audited and are sitting in front of Mr. IRS man. Do you really think, he won't be able to find out that you are making income off marijuana?"

 

Despenceries have absolutely been audited, didnt know that when that happens the feds will automatically come and take you to club fed.(Im sure they know what they're doing)

 

Goggle "How does a caregiver pay taxes."It will bring you right here, to people saying, "anybody whp claims income from being a CG is fuxing HIGH on CHRONIC. ..."looks pretty bad. If thats the consensus with caregivers here(which im sure its not) ,maybe we should work on the message.

 

I not tring to say this is how you have to do it,but I find it hard to belive that the feds are going after the people that are trying to do the right thing, paying their taxes.

 

As far as"If a caregiver is a TRUE compassionate caregiver that doesnt rape people on price"No one is talking about raping people on prices.

 

 

and

Good advise, hey you got any swamp land for sale?

 

You forgot to say you would try and keep in touch,,they dont let you call collect from jail,,,Unfortunatly my friend I know this from real life, 3 times since becoming legal!

 

Phaquetoo

You say you have been in trouble three time since becoming legal,but your all over this site asking a caregiver that wants your right to be illegal right off the bat.Good luck with that.No ill will to you, but #4 may be in your future. "

" I expect 6 ZIPS the day we mail in the forms, and If i want more than a zip a month, I want it for 150 a zip PERIOD!

and if in 6 months you want to keep being my c.g and your meds are topshelf, I will keep you if you come and give me 6 more zips for the following 6 months!"

 

 

I guess Ill be the test case for this one and pay my taxes.

 

 

Sorry about the grammer Im no english major.

 

 

how is that going to give me #4? The c.g is the one who will be in trouble, I wont get caught with a zip over! You must be new to the game, or maybe you been claiming taxes on it for yrs, so you dont go to jail like al capone! lol!

 

What a phaqing joke! my whole pointe is if the shady c.g wants to make money offf of my plants he best take care of me, and I realy dont care what happend to c.g, if they break the rule they go to jail, and who says 6 zips in my possesion (home with 2 patients is to much) would if we both need 3 zips a month? who is to say what is a reasonable amount of meds to keep in coninious use? you?

 

Peace

FTW

Jim

[pic book]

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Edited September 11, 2013 by pic book

[Dlo]

I would like to hear the opinons of the despensery owners on this site. Im pretty sure there are a few.

 

Kind of a big deal.

[kirsten]

When you read the transcripts of DOJ prosecutions of CA dispensaries as instigated by the DEA's investigation, exhibit #1 or at least an exhibit in the first dozen exhibits is the dispensaries' Federal income tax filing. When DOJ prosecutes there is no confidentiality for tax filings be they Federal Income, Corporate or Personal, State Income, Corporate or Personal, or State Sales Tax. Federal reach is not inhibited by Obama's lips flapping about Feds respecting folks following state law but violating Federal. DOJ/DEA is run by career prosecutors and if you do volume, Feds make no distinction between medical retailers and other "dealers," and use your tax filings to document your volume (with bank records), 'proving money laundering,'

 

Interesting. I figured it was money laundering if you run it through another businesss to "clean it", but if you set it up as a health related company and have service fees that doesn't seem like laundering to me and the CPA agreed.

I am surprised more caregivers are not concerned about this. We are struggling to be seen as a respectable profession-which it is, and paying taxes, educating ourselves about HIPPA laws and behaving like professionals is really important or the rich people and pharmacies will take it over.

[xxsesimeseedxx]

What about the cg's out there that are DONATING the majority of their meds to patients? When you file your taxes, and want to write of those donations, what are you going to say you donated???

[Dlo]

What about the cg's out there that are DONATING the majority of their meds to patients? When you file your taxes, and want to write of those donations, what are you going to say you donated???

 

 

Great question.

If it were me,I would ask a professional.

[Dlo]

If you dont want to pay your taxes, then dont. Thats on you.

 

Lets not pretend that you cant.

[kirsten]

I live in Genesee County. Half of our houses are boarded up or burned out because we have no jobs here. I personally have two college degrees and have been laid off twice and am not eligible for unemployment. We have rats in the street. Stray dogs to the point where people are afraid to walk around. Middle school kids get shot and killed on a regular basis and there was a giant serial stabber making his way down the main street and a handful of police. It's been like this since the 80's when GM laid off thousands and thousands of people and its still happening.

I am not letting anybody tell me that we can not do something that will help create jobs.

WE HAVE NO CHOICE! And yes I am writing in all caps because I'm yelling.

Nice enough rant for you? I know I feel better.

[kirsten]

Oh yeah-and yes I have compassion for patients. I am one. We donate regularly to animal shelters, women's shelters and the soupkitchen-not meds of course-our time $,food and clothing. Our patients do it too because they are good people.

[Retta]

I want to write off cost of supplies and DTE, I'm saving my insurance company $1000's in RX drugs every year.

[Broken]

I think that the important question here is how exactly we should handle this situation. I'm not sure if I'll ever be in the situation myself, I don't know if I'm going to get rid of overages, help other patients or any of that but if i did i'd want to know what to do.

 

Nobody here is really giving a good answer as to what exactly to do. I don't do my own taxes, I don't know the laws or rules behind them, I go to one of the chain tax companies.

 

If we aren't selling the plant but a service of time, electricity, etc. Why can't we just tell the tax man we got x amount of money for helping friends with labor...

[The Digital Nomad]

The whole idea of filing taxes voluntarily - is to prevent the IRS from retroactively coming after you. I figure it will take the IRS the same couple of years to realize what is going on, and then like any other government scam - they will figure on retroactive punishment for CGs or 'small MM business enterprises'.

 

Lets say the IRS figures modestly that CGs can make $17,500 per patient per year. They 'assume' you will grow the full 12 plants of each patient. They send all the CGs a notice 'We know you have been a CG for several years, you have not filed taxes, based on our calculations you owe us taxes based on $87,500 each year."

 

They ask that YOU prove that YOU DID NOT MAKE THAT MONEY. If you did not file taxes with a certified accountant, you haven't filed anything, and a box of reciepts is not going to cover your donkey.

 

So, the MOCC learned of a tax accountant that has worked out all the rules for tax filing, as a farmer. No mention of marijuana, no itemized list that says "lemon Skunk, ounces, patients".

 

NUMBERS

James Campbell CPA

Royal Oak

James@numbers-accounting.com

www.numbers-accounting.com 248-794-0798

 

Your tax filings will zero out, you owe nothing, and the government owes you nothing - and its FILED so the IRS can't come back after you retroactively!!!

 

-DN

[Broken]

hmm i guess. How would they know you are a caregiver in the first place? If you sell to a dispensary which requires you to pay taxes at the end of the year is one thing, but they wouldn't know if you were just growing for your patients.

 

One big thing that worries me about calling yourself a farmer is that if something did happen and you get arrested they could say that you in essence are confessing to selling the plant, we are only allowed to sell our services, the plants belong to our patients.

[pic book]

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Edited September 11, 2013 by pic book

[Hempcheff]

I guess well have an answer to this soon:

 

http://michiganmedicalmarijuana.org/topic/26435-irs-auditing-oaklands-biggest-pot-dispensary/page__pid__240911#entry240911

[Tazman1602]

VERY VERY VERY Good advice.

 

What most of you have to remember is that weed is still illegal under federal law and they recognize nothing to do with it. All income must be reported, NO expenses may be taken! As a user even with a card you may NOT deduct those expenses as medical either.

 

And those of you who *think* you are going to get away with the "cash" thing? WRONG! That's bootlegging technically. Do you think Al Capone went to prison for murder? It was income tax evasion that they finally put him away on. Look for the same tactics here.

 

You NEED a MMJ friendly attorney AND accountant.................and preferably a creative accountant...........

 

 

 

If you must .. section 280e

 

A little history. Someone got busted. They reasoned that:

1. The government claimed he was running an illegal business.

2. The government wanted their taxes from the business that he ran.

3. It is reasonable to claim lawyer fees as business deductions.

 

So he claimed the lawyer fees for his trial lawyer as a deduction from the business.

 

The court held that he could claim his attorney fees.

 

So congress passed a new part of the tax code so that drug dealers could not claim a tax deduction just because they got busted.

 

So then .. 280e says that if your business is about a schedule 1 or schedule 2 drug, you are not allowed to take any deductions at all. NONE AT ALL!!!

 

So then .. say your entire year looks like this:

 

1. 1/1/2010 bought a ounce for my patient for $300.00

2. 1/2/2010 delivered the ounce to the patient for $300.00

 

So the items you are supposed to tell the IRS about is item number 2. You are not allowed to list item number 1. According to section 280e of the federal tax code you are not allowed to use any deduction at all.

 

So your schedule c would show $300.00 of taxable income.

 

However .. if I have a gardening and consultation business ..

 

Important note here:

 

There are several attempts to reschedule marijuana from schedule 1 to 2. That will not help us in being honest with our tax filings. Marijuana would still fall under 280e as 280e covers both. Tax law would still be used against us.

 

Never ever ever ever mention marijuana on ANY tax form.

[MiMeds4U]

From my understanding correct me if I am wrong, caregivers are not suppose to "Sell" there crop they are suppose to take donations that go towards costs to operate and facilitate the grow room and everything needed.. I never heard of paying taxes or claiming donations?!?! Since donations are being accepted for the medication I do not see any reason Uncle Sam should expect it to be reported.. Am I wrong or??? Any replies would be greatly appreciated.

 

Donations can't be taxed can they?

 

MiMeds4U

[Mr. Wilson]

It's doomed if you do and doomed if you don't.

 

When you are sitting in front of the IRS man and he says, "Oh I see you paid your taxes on your marijuana distribution activities?"

 

You say, "Yes sir, I'm a good citizen."

 

He says, " You do know that growing and selling marijuana is a Federal crime don't you?"

 

"Yes sir."

 

"Then you admit that you have broken Federal law?"

 

"I suppose I did....but it's legal in Michigan"

DOOMED!!!

==============================================================

 

On the other hand:

He says," My audit shows that you had 25,000 dollars of income that is not reported here?"

 

"Ah ah ah....well...it's legal in Michigan"

DOOMED!!!

[stellar]

This is what came up in google so I ask, what are ,if any, the new developments on this. First thing that came to my mind was that caregivers do not sell marijuana, they are compensated for maybe working in a grow room, providing space, electricity, delivery services, consultation, etc, but non of this seems like it would ever have to come to the conclusion of admitting what it is that you grow in the grow room, besides various strains of plants. I'll grow tomatoes to sunflowers if the client ask me to. The fact I grow marijuana for my client via legal means (I am a legal caregiver and my patient is a legal patient per my state) is no ones business. But more or less it seems like we are gardeners that dont sell what we grow thus its irrelavant. Just thinking out loud.

 

stellar

[stellar17]

You might find this article helpful

 

http://www.forbes.com/sites/robertwood/2013/09/04/new-doj-marijuana-policy-wont-fly-with-irs/

 

and this one cited by Robert Wood in the Forbes article above

 

http://polis.house.gov/news/documentsingle.aspx?DocumentID=318723