Working with an Accountant that specializes in cannabis accounting will be able to help you succeed in this business and avoid any major roadblocks. More and more cannabis businesses have been surfacing as more and more states are moving towards the legalization of medical as well recreational use of cannabis and trade. Whereas cannabis dispensaries as well as grow operations have a lot of the same problems that new businesses need to contend with, their set of challenges are likewise unique.
1. Getting an Account with a Bank
A most fundamental problem, among many others,
facing those in the cannabis industry is how to get a bank account. Because the substance is still controlled on the federal level, banks are mostly dubious about dealing with cannabis clients. While guidelines to banks have been issued to banks from the federal government on authorized state cannabis ventures, majority of banking institutions do not want to deal with the risk of having clients or account holders that are engaged in the cannabis industry.
An Accountant will assist you to find your needed banking services, at a minimal cost possible.
2. Exploiting GAAP to be Keep Yourself Outside of Trouble
GAAP or generally accepted accounting principles are a set of standards which govern businesses on how they are anticipated to maintain their books along with the account such as for depreciation, among other things.
Several agencies of the federal government are actively checking on cannabis businesses and they are examining how they carry out their business. The SEC along with the IRS are two of the agencies that are most dangerous for cannabis traders. Both of them are not only able to impose a fine on businesses, but they as well can file criminal charges.
By using GAAP, you and your cannabis business will be able to evade any of the terrible consequences once these agencies go for an examination of your books.
3. Escaping Tax Traps
Taxes are forever complicated for any business. However, the IRS has even made things harder for the cannabis industry by severely restricting their tax deductible expenses. If you have a cannabis industry Accountant with enough experience, he/she will be able to help you out in tax planning and also tax compliance.
4. Living through an Audit
Audits are never easy, but if the auditing agency considers the as illegitimate in general, audits can even be more agonizing. Working with an Accountant while confronting an audit is probably the only means to endure such a test.
5. Familiarity with the Numbers
An Account is educated to calculate as well as to interpret the important monetary indicators for a business. Anybody who wishes to survive such a cutthroat cannabis industry, you need help from an Accountant in understanding the financial strengths as well as weaknesses of your business. You also will benefit from the strategic guidance they can offer in order to come up with the best investment and tax decisions for what is yet to come for your trade.