According to the Controlled Substances Act, psilocybin among other “psychedelic” substances is considered a schedule one drug and is federally illegal. Like Marijuana manufacturing, selling, or possessing psilocybin is a federal crime.
Although, at the federal level, there has been a political tug of war to honor and protect state’s rights over their decision to decriminalize, most states have now implemented some sort of marijuana program, if not having legalized it all together. But, one thing remains, congress’s treatment of the tax implications of enterprises profiting from the “trafficking” of these schedule one substances.
Contrary to the definition of a schedule one drug having no medical benefit, cannabis, and now psilocybin, are being legalized for medical purposes at the state level. However, the federal government further penalizes these industries through the implementation and enforcement of a tax code call IRC 280E.
Although, it is too early for businesses to legally profit from psilocybin, if it is not removed as a schedule one substance from the Controlled Substances Act, it will also be subject to 280E. For more information on how psilocybin could also be subject to these tax penalties visit our cannabis tax and accounting page.
Oregon is will begin receiving applications starting January 2nd 2023.
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