Est. 2026381 listings · 29 categoriesUS + Canada
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Accounting, Tax & CFO

Accounting firms and fractional CFO services fluent in cannabis — 280E tax treatment, cost accounting, cash-heavy controls, and audit readiness. Generic accountants routinely get this industry wrong; these firms specialize in it.

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Cannabis accounting, tax, and CFO services address the financial reporting and tax burden created by operating a state-legal business that federal law has long treated as illegal drug trafficking. The center of that burden is Internal Revenue Code Section 280E, which denies a business trafficking in Schedule I or II controlled substances its ordinary deductions — rent, marketing, most wages — leaving only cost of goods sold, which typically pushes effective tax rates well above those of non-cannabis businesses. Since a DEA final rule took effect on April 28, 2026, marijuana covered by a state medical marijuana license is in Schedule III, and the rule states that state medical licensees will no longer be subject to 280E, while noting it is not a determination of federal tax liability; adult-use marijuana remains in Schedule I and still carries the full 280E burden. This category covers CPAs and outsourced CFOs who build cost-accounting systems that properly allocate expenses into COGS, prepare for the audit scrutiny 280E invites, and manage the multi-state tax filings and cash-intensive banking realities cannabis operators face.

Choosing an accounting partner means prioritizing 280E and cost-accounting experience over general small-business bookkeeping — ask how they document COGS allocation methodology, since that's what an IRS audit will test first. Outsourced CFO services should offer more than compliance: look for cash-flow forecasting suited to a cash-heavy, thinly banked business, and multi-state tax coordination if you operate in more than one jurisdiction. It's also worth asking how a firm is handling the April 2026 change — which expenses in a combined medical and adult-use operation now fall outside 280E, and how earlier tax years are treated — and how it is tracking the separate DEA proceeding on rescheduling all marijuana, which is still pending with no confirmed outcome or timeline; no provider should be relied on to predict it.

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Questions about accounting, tax & cfo

What is 280E and how does it affect cannabis businesses?
Section 280E of the federal tax code denies deductions and credits for expenses connected to trafficking in a Schedule I or II controlled substance. A business subject to it can still deduct cost of goods sold, but not rent, marketing, most wages or other ordinary expenses, which pushes effective federal tax rates far above comparable non-cannabis businesses. Since April 28, 2026, marijuana covered by a state medical marijuana license is in Schedule III under a DEA final rule (91 FR 22714), and the rule states that state medical licensees will no longer be subject to 280E (it adds that it is not a determination of federal tax liability); adult-use marijuana remains in Schedule I and remains subject to 280E.
How do cannabis companies legally reduce 280E exposure?
The main lever is cost accounting: properly classifying as much expense as possible into cost of goods sold under IRS rules, which requires production-based allocation methods for growers and processors that differ from standard retail COGS rules. This is technical and audit-sensitive work, so it's typically handled by accountants with specific 280E and cannabis cost-accounting experience rather than general bookkeeping.
Did federal rescheduling eliminate 280E?
Partly. Section 280E applies only to Schedule I and II substances. A DEA final rule effective April 28, 2026 (91 FR 22714) moved FDA-approved marijuana products and marijuana covered by a state medical marijuana license to Schedule III, and the rule states that state medical licensees will no longer be subject to 280E; it adds that it is not a determination of federal tax liability and encourages Treasury to consider relief for earlier tax years. All other marijuana, including adult-use, stayed in Schedule I, and a separate DEA proceeding on rescheduling all marijuana is still pending, stayed by DEA's chief administrative law judge on September 29, 2026, with no confirmed outcome or timeline. Operators with both medical and adult-use sales need a defensible way to separate the two, and how earlier tax years are treated is a question for a cannabis tax adviser — this is informational context, not tax advice.
What does an outsourced cannabis CFO do differently from a regular CFO?
An outsourced cannabis CFO manages financial planning under 280E's cash-tax burden, builds cash-flow models around limited or restricted banking access, and often coordinates multi-state tax filings for operators licensed in several states. Many also advise on capital raising, since traditional lending and equity markets remain more limited for plant-touching cannabis businesses than for other industries.
What makes a cannabis business audit-ready?
Audit readiness means documented, consistent cost-accounting methodology for COGS allocation, clean separation of plant-touching and non-plant-touching revenue where applicable, and financial records that can withstand IRS scrutiny given how frequently 280E positions are challenged. Businesses working with accountants experienced in cannabis-specific IRS exam patterns are generally better positioned if an audit occurs.

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