Cannabis Musings - April 24, 2026
More on rescheduling (what else are we gonna talk about?)
Friends – we talked extensively yesterday about the rescheduling order, and things are moving fast and furious, like going from stealing DVD/VCR players to saving the world multiple times over. Some updates:
First, our This Week in Cannabis LIVE roundtable conversation with the esteemed Eric Berlin, Partner at Dentons LLP and head of the firm’s global cannabis practice, from earlier today is a mandatory watch. Not only does he provide deep insight into the political dynamics behind the order, but he also offers a valuable perspective on the significance of what’s happened. The implications for the future of the industry are gros vi a barg (“as big as a mountain”).
Second, we’ve already sort of got some answers to our tax-related questions. One of those was whether operators who play in both medical and adult use could still benefit from 280E tax relief:
“In the meantime, what’s not yet clear is what happens to operators who hold both medical and adult use licenses, because 280E applies to the taxpayer, not the product. If an operator is selling both adult use and medical, it’s still “trafficking” in a Schedule I controlled substance, suggesting that 280E would still apply to that taxpayer, regardless of whether they’re selling some non-Schedule I/II products.”
The other was whether the IRS would allow this to be retroactive. Well, remarkably, the US Department of the Treasury and the IRS released a statement mere hours after the order came out suggesting that the answers to our questions will be ‘Yes’ and ‘No, at least not yet’:
“Guidance is expected to clarify the ways in which, for businesses with multiple activities, section 280E applies only to those activities related to trafficking in Schedule I or II controlled substances (e.g., by apportioning expenses). Guidance is also expected to include a transition rule providing that, for purposes of section 280E, rescheduling generally will be considered to first apply for a business’s full taxable year that includes the effective date of the Final Order, for the business’s activities that do not involve Schedule I or II controlled substances as a result of the Final Order.”
So, there you have it, though we’ll have to wait and see what the IRS actually issues as official guidance.
Finally, from an advocacy perspective, the cannabis industry should immediately turn its attention to working with state regulators and lobbying state legislators to expand medical cannabis. Yes, the irony of that should be savored like a kasha knish fresh out of the oven after years of the industry working tirelessly to transition states to adult use, but we should be taking full advantage of the fact that the federal government is endorsing medical cannabis. The administrative court process to consider rescheduling adult use will take time to play out (and is not as certain (not legal or investment advice)), and it will take time to change state laws.
Although we shouldn’t expect a procedure where every customer who walks through the door is immediately ‘diagnosed’ by Dr. Lexus with dum-dum fever, lowering the bar to obtaining a medical card (expanding conditions and diagnosing practitioners, and keeping the cost low) in order to take advantage of what the federal government has now done for medical cannabis would benefit customers and operators alike. Medical cannabis is less scary from a political capital perspective, and states have been granted cover. Let’s not miss this opportunity of this gift that we’ve been given here.
Be seeing you.
© 2026 Marc Hauser. None of the foregoing is legal, investment, or any other sort of advice, and it may not be relied upon in any manner, shape, or form. The foregoing represents my own views and not those of Jardín, B&Y Ventures, or anyone else who employs/hires me.
Watch me schmooze almost every Friday at Noon ET on This Week in Cannabis LIVE with Jeremy Berke and Jay Rosenthal of Cultivated Media and AnnaRae Grabstein and Ben Larson of the High Spirits Podcast. Access the livestream and recordings here.