Welcome to THC Accounting
From Seed to Sold and Beyond
THC Accountant isn’t like other accounting and tax service providers. Our services relate and pertain to one industry – The Cannabis Industry. With the federal status still being illegal, there are requirements and guidelines to consider preventing getting into trouble with the IRS. Care needs to be taken to maintain your books and documents so you’re ready when the IRS comes.
You keep it rolling in the front. We keep it rolling in the back.
The aim of using a cannabis accountant is to not only simplify your life, but legally minimize your tax liability.
Proficiency Cannabis Business Owners Need
THC Accountant uses their knowledge and experience to support business owners in the cannabis industry. Areas of expertise include:
- Tax Planning and Preparation to Navigate IRC §280E – IRC §280E pertains to how the IRS views cannabis income and whether normal and necessary deductions can be taken. Due to §280E, cannabis businesses are unable to use normal and necessary deductions to lower their tax liability. An experienced THC Accountant knows how to manage §280E to legally minimize your tax liability using Cost of Goods Sold. Navigating §280E requires expert handling multiple areas as detailed below.
- GAAP Financial Accounting – Without GAAP accounting, your §280E strategy falls apart. You need more than regular GAAP financials. Instead, your financials need to be adjusted to work with §280E and other tax codes to legally minimize your tax liability.
- Accrual Cost Accounting – Accrual cost accounting is the bread and butter of navigating §280E. Most accountants either aren’t doing it or aren’t doing it right. Without solid cost accounting, you are guaranteed to be overpaying to the IRS.
- Entity Structuring – Improper entity structuring can hurt in multiple ways. Many cannabis companies have paid the price for choosing the wrong structure and/or not having the proper documents, policies, and procedures in place to back it up. Save yourself the headache and learn what the best entity structure is for you.
- Recordkeeping – There’s more to be done than merely keep records to navigate §280E. You and your investors need ongoing access to your records for special projects, tax returns, inspections, etc. – not to mention when the IRS shows up! You need a recordkeeping system that’s through and accessible to anyone who needs it.
- Policies and Procedures – Safeguarding cash is one example of why policies and procedures are essential. Cash and cannabis theft is increasing across the nation. Other examples of policies and procedures include the employee handbook, job descriptions, and internal controls. Policies and procedures enable your business to be a well-oiled machine.
- CFO and Advisory Services – In addition to policies and procedures, your cash flow, KPIs, and budget need to be monitored. From your proforma, if you’re a start-up, to ongoing monthly reporting, your business analytics are set up and maintained so you know what’s working and what’s not.
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Cannabis Business Services
The relationship between a cannabis related business and their accountant can have major impacts on the running of that The relationship between a cannabis related business and their accountant has a major impact on the success of your business. It’s not if the IRS is coming – it’s when. You need to be prepared accordingly.