This bill reinforces the federal tax code's prohibition on business tax deductions and credits for companies involved in marijuana trafficking. Specifically, it amends Section 280E of the Internal Revenue Code to explicitly state that marijuana businesses cannot deduct ordinary business expenses—such as rent, utilities, salaries, or supplies—from their taxable income, even if they operate legally under state law. The change would apply to any amounts paid or incurred after the bill's enactment. This means marijuana businesses would effectively pay taxes on their gross revenue rather than net profit, substantially increasing their tax burden. The bill targets both federal illegality and state-level prohibitions, meaning it could affect even state-legal cannabis operations. No specific funding is allocated since this is a tax code amendment rather than a spending bill.
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