How To Lower Your Tax Liability
[custom_blockquote style=”eg. green, yellow, purple, blue, red, black, grey”]The rich are there to make all the money and pay none of the taxes. The middle classes are there to do all the work and pay all the taxes. The poor are there to scare the daylights out of the middle class so they’ll keep working and paying all the taxes. George Carlin[/custom_blockquote]
Federal income taxes are the single largest expense you’ll encounter in the cannabiz industry with many businesses paying in excess of 70% of their gross profits to the IRS.
Our strategy when working with marijuana business owners is to maximize their Cost of Goods (COG) deductions. The sad fact is that the IRS will never tell you about a COG deduction you didn’t claim. Discovering legitimate deductions is up to you and your financial team. Our tax system is indeed very complex and tax laws are ever changing. The Internal Revenue Code, the Federal tax authoritative guide, is a thick book with over 1.3 million words. Albert Einstein was quoted as saying “The hardest thing in the world to understand is the income tax.”
Here at Cannabiz Accounting, we understand the frustrations that you encounter. In pursuing lower income taxes for our clients, it is never necessary to resort to tax cheating or tax loopholes, or even to question the legality of our system. It is about setting up your accounting system and your chart of accounts to accurately reflect and maximize your COG’s deductions.
Many accounting firms may claim to understand your business and many CPA’s have already purchased our book “IRS CODE 280E SIMPLIFIED”. These CPA’s and accountants have taken the first step to learning about the code and the uniqueness of the tax laws surrounding the marijuana industry. We applaud them as they navigate their way into this lucrative industry.
Comparing accounting services is usually a difficult task for a marijuana business owner. It appears that one would need to BE an accountant in order to have the needed expertise to tell which service would be the best for you. But it isn’t so. You can simply create a LIST of what YOU want and need — and then simply ask different accounting firms how their service meets with your requirements.
The important thing is to look at it solely from YOUR viewpoint and not go into anything else. Below, we have compiled the most important points. Just pick the ones you agree with and start calling.
Cannabiz Accounting has the client list and the testimonials to support our efforts in legally minimizing your tax liability with the IRS. We invite you to call everyone you find that says they handle accounting and tax services for the marijuana industry and then give us a call. We know it will be the last one you need to make!
- What is IRC 280E and how does it apply to your business?
- What are examples of direct COG’s deductions?
- What are examples of indirect COG’s deductions?
- Is sales and excise taxes deductible as COG’s?
- Is state taxes paid deductible as COG’s?
- Is sales tax paid to vendors deductible as COG’s?
- Does your business need a Point of Sale System and why?
- Does your business need to take inventory on a monthly basis?
- How do you deal with inventory breakage?
- How do you track business income and expenses?
- Does it make sense to use QuickBooks online and why?
- If you do not have a bank account, how do you record transactions into your accounting records?
- Do I need to have employees or can I treat them as independent contractors?
- How do I as an owner pay myself?
- How do I handle payment of payroll taxes?
- What type of guarantees do you offer for your accounting and tax services?
- Are you able to consult with me on how to grow my business?
- How many IRS audits have you performed and what were the results?