Understanding the legal requirements for a Cannabis business can be daunting because of the variety of ways that states have chosen to legalize, regulate, and tax Cannabis. However, with some research and planning, you can become prepared to launch a Cannabis-related business legally and successfully.
Types of “CannaBusinesses”
As you get started in a Cannabis related field, you want to be sure that you are not just aware of the rules for dispensaries. Depending on where you are located, the legality and regulations will be different for the cultivation of cannabinoids, Retail/Dispensaries/Collectives, or the distribution and sale of Infused Products like Edibles, Tinctures, and Salves.There are also testing facilities that abide by another, distinct set of rules.In most states, you’ll need to pick a business license application based on the kind of Cannabis business you have selected, so research what all falls under, for instance, Nevada’s licenses for “distributing facilities”versus “cultivation facilities.”
Thriving Legally: How to Meet the Requirements for a Cannabis Business
Research Cannabis Laws By State
While, at last count, 29 states have taken at least some steps toward decriminalizing medical or recreational marijuana, every state is both technically legalizing different aspects and regulating in a unique way.At this point, you have everything from Alaska’s legalization of both medical and recreational marijuana and an established path to a business license, to Washington D.C. where legalization has passed but there are no legally sanctioned recreational sales points. Make sure to keep ahead of the changes and implementation phases of state laws and regulations.
Research Cannabis Laws By Local Government
Just because you’ve fully complied with your state regulations doesn’t mean that there aren’t locality regulations that also matter. For instance, in some areas of California, there is a specific Cannabis business tax. Ideally, you should research these taxes before deciding the location of your business, but if you choose a locality with strict regulations regarding Cannabis, it is important for the success of your business to learn about them and abide by them. Speak to your local Chamber of Commerce or a city/county tax office for more information.
Consider Meeting With An Attorney
Especially in states with a complex network of regulations about reporting your marijuana sales, including legal limits per customer, you are likely to benefit from a consultation with a small business attorney who has experience with the Cannabis regulatory industry in your particular state.Write up your business plan, including where you plan to locate based on existing zoning and your available capital, and bring every piece of research you’ve done to your consultation. By doing your homework but not submitting legal paperwork until after you consult, you will save yourself tons of time and costly application fees.
Understand Cannabis Tax Laws
In many states, legalized marijuana carries hefty excise taxes, cultivation taxes, or sales taxes that are specific to cannabis. These taxes are often different based on whether the marijuana is purchased through a medical license or a recreational establishment. Make sure you understand how this tax is collected, what reporting you are responsible for doing in order to prove you are collecting the correct taxes, and how any of these taxes are set to change in the near future. One excellent way to keep ahead of these regulations is to use a Cannabis-specific point-of-sale software that has tax and regulatory integrations. Our marketplace contains a variety of options.
Get Appropriate Permits if Transporting Cannabis
Even within areas that legalize marijuana, there are regulations on who can transport Cannabis, including how much can be transported. To legally transport Cannabis in California, for instance, a Motor Carrier Permit is required. Depending on where your business exists in the supply chain, make sure that other businesses you work with also have the necessary transport permits so that you will not run into supply snags due to missing permits in the future.
Keeping track of local and state regulations is much easier with great Cannabis industry software. Browse our marketplace today for the products that will help you maintain compliance with legal requirements and regulations.