280E

280E

Federal and state law current as of September 2026 — verify with counsel.

Key takeaways

IRC §280E. Disallows ordinary deductions for Schedule I/II trafficking. Medical Schedule III activity generally leaves it after 28 April 2026.
Use the term the way the regulator uses it.
Do not import another state’s definition.
Ask counsel before the LOI uses the word as a promise.

IRC §280E. Disallows ordinary deductions for Schedule I/II trafficking. Medical Schedule III activity generally leaves it after 28 April 2026. Federal and state law current as of September 2026 — verify with counsel. This is educational, not a guarantee of price, timing, approval, or financing.

Why 280E matters in a cannabis sale — how should you read this on 280E?

280E is how a regulator or a CPA will test the file. A forum definition does not survive Maryland or Nevada.

How 280E is used correctly — what should you verify for 280E?

Used correctly, 280e is a condition you can point to in a statute, a lease, or a tax workpaper. If the LOI promises something the agency cannot honor, rewrite the LOI.

How 280E is misused — what should you verify for 280E?

280E gets inflated in teasers and ignored in diligence. Diligence and transfer review exist to stop that.

Use of 280E	Broker reading
280E in a CIM	Must match the statute, not a slogan
280E in an LOI	If it requires agency consent, say so
280E in a model	Label ranges; do not hide 280E
280E vs a neighbor word	Do not swap 280e for a look-alike term from another state

File example that turns on 280E — what breaks 280E?

Illustrative: Maryland uses 280e as a defined term and Nevada does not. Importing the first statute into the second file is how packets bounce.

Nearby words people confuse with 280E — what breaks 280E?

If someone says 280e and means a different glossary entry, stop and pick the right slug. The glossary index exists so 280E stays precise.

280E still lives under two federal clocks. Medical activity generally left 280E after the April 2026 order. Adult-use activity did not. SBA SOP 50 10 8 still bars plant-touching 7(a) and 504 loans. SAFE Banking Act of 2026, S.4942 is a bill, not a close condition. Banks that stay in the category still cite FinCEN FIN-2014-G001.

Cited sources that govern 280E: IRC §280E still disallows ordinary deductions on Schedule I trafficking, which is why adult-use books stay in 280E. FinCEN FIN-2014-G001 remains the SAR frame banks actually use. SBA SOP 50 10 8 keeps plant-touching targets out of 7(a) and 504, including medical. SAFE Banking Act of 2026, S.4942 and H.R.9471 were introduced in 2026 and are not law.

Read deal structure next if that file is open on 280E. sell is the companion page when 280E needs that angle. Keep buy in the working set for 280E. Read 280E next if that file is open on 280E. METRC is the companion page when 280E needs that angle. Keep glossary index in the working set for 280E. Read federal law next if that file is open on 280E. 280E is the companion page when 280E needs that angle.

Which public sources belong on this file?

Keep IRS marijuana industry page, eCFR CSA schedules, USDA hemp production, USCIS Policy Manual in the working set. A forum post is not a substitute.

Frequently asked questions

What does 280E mean in a cannabis sale?

IRC §280E. Disallows ordinary deductions for Schedule I/II trafficking. Medical Schedule III activity generally leaves it after 28 April 2026.

Is this legal advice?

No. Confirm the term against the statute and counsel.

Does the definition travel across states?

No. 280E in one statute is not automatically 280E in another.

Where does it show up in a deal?

Applications, LOIs, CIMs, and often the approval contingency.