Bennet, Perlmutter Ask IRS To Waive Pot Tax Penalties
DENVER (AP) - U.S. Sen. Michael Bennet and U.S. Rep. Ed Perlmutter are asking the Internal Revenue Service to waive penalties levied on marijuana businesses for paying taxes in cash.
The IRS charges a 10 percent penalty on cash payments for federal employee withholding taxes. But Bennet and Perlmutter say in the letter Friday to IRS Commissioner John Koskinen that Colorado marijuana businesses “are having extreme difficulties accessing the banking system.”
Because pot is illegal under federal drug law, marijuana businesses have trouble accessing banking services despite federal guidance earlier this year on how banks may accept pot money. Bennet and Perlmutter say the businesses have little choice but to make tax payments in cash.
Marijuana dispensary Allgreens LLC of Denver is challenging the IRS practice of fining cash payment with a lawsuit in U.S. Tax Court.
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