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Are You Ready to Take Advantage of Rescheduling?

By Scott Hammon, CPA, Barbara Webb, CPA, and Sarah McGuire, CPA

Key Takeaways:

  • The potential rescheduling of cannabis presents an opportunity to reevaluate your company's tax structure and increase deductions, reduce income, and simplify accounting.
  • Rescheduling may open up access to previously unavailable tax credits, incentives, and deductions at various government levels.
  • With anticipated increased investment and cash flow after rescheduling, companies should prepare for potential mergers and acquisitions by seeking support in areas like financial due diligence and post-acquisition planning.


The rescheduling of cannabis from Schedule I to Schedule III will unlock new opportunities for cannabis businesses. Is your company positioned to capitalize?

Tax Restructuring

If your existing operating structure was optimized for Section 280E mitigation, now is the time to evaluate whether it will still be tax-efficient after rescheduling.

MGO’s dedicated cannabis tax team can analyze your current structure and identify opportunities to increase deductions, reduce income, simplify accounting, and eliminate unnecessary tax exposures. We will help you develop a strategy specific to your business needs that aligns with your operational goals and any regulatory considerations.

Tax Credits, Incentives, and Deductions

Rescheduling should open cannabis operators to a world of previously unavailable tax benefits.

Our tax professionals can comprehensively review your business operations to uncover tax credits, incentives, and deductions that you may qualify for at the federal, state, and local levels.

Financial and Internal Control Audits

While rescheduling will eliminate the Section 280E tax burden and attract new investors to the cannabis industry, it could also lead to a new regulatory framework.

Our audit services can provide assurance to investors that your company is effectively managing risks, complying with any regulatory changes, and maintaining transparency.

Mergers and Acquisitions (M&A)

The projected wave of investment and increased cash flow resulting from rescheduling means more M&A should be on the horizon.

If your company is considering an M&A deal (either as a buyer or seller), MGO can support your efforts with structuring, financial & tax due diligence, Quality of Earnings (QoE) assessments, accounting integration, strategic guidance, and post-acquisition planning.

With a dedicated cannabis team and a comprehensive line of services, MGO can help you take full advantage of the benefits made available by rescheduling. Reach out to our team today.

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