Cannabis Business Accountants in Nevada

Key Points:

• Cannabis CPA: specializes in regulatory and financial management and handle complex tax laws like IRC §280E
• Specialized Needs of Cannabis Business: Tax strategy, inventory and cash management, and audit preparation.
• Tax Rates: Tax structure includes a general retail sales tax of 6.85% (with local additions up to 8.375%), a 10% excise tax on retail cannabis sales, and a 15% excise tax on wholesale cannabis sales.

So, What Exactly is a Cannabis CPA?

A cannabis CPA specializes in navigating the regulatory and financial landscape of the cannabis industry. From dealing with complex tax laws, like IRC §280E, to managing limited banking options, cannabis CPAs play a crucial role in ensuring compliance and financial stability.

• Nevada’s growing cannabis industry, with over 700 active establishment licenses across cultivation, production, testing, distribution, and retail sectors, presents significant financial and regulatory challenges. Cannabis, CBD, and hemp businesses in the state face unique accounting needs that require specialized expertise to maintain compliance and optimize operations.

• Are you a Nevada-licensed CPA offering services to cannabis-related businesses? Request to be listed .

How Nevada’s Cannabis Taxes Work

Nevada imposes several taxes on cannabis sales, adding to the financial complexities faced by businesses:

• General Retail Sales Tax: Nevada’s sales tax rate is 6.85%, with local additions resulting in rates up to 8.375%.
• Cannabis-Specific Taxes:
  • Retail Cannabis Excise Tax: A 10% excise tax applies to adult-use cannabis sales.
  • Wholesale Cannabis Excise Tax: A 15% excise tax is levied on the first wholesale sale of cannabis.

What Cannabis, CBD, and Hemp Businesses Need from Their Accountants

While all three sectors—cannabis, CBD, and hemp—require specialized accounting services, their specific needs differ based on regulations and tax requirements.

• Cannabis Businesses: Cannabis CPAs ensure compliance with Nevada Cannabis Compliance Board regulations, assist with tax planning under IRC §280E (since most expenses can’t be deducted), and implement accurate cost accounting for production and inventory.
• CBD Businesses: Accountants help CBD businesses stay compliant with state labeling and marketing standards and secure tax deductions for ordinary expenses, while monitoring regulatory changes.
• Hemp Businesses: Accountants support compliance with Nevada’s agricultural standards, assist with tax planning (since hemp businesses can deduct regular expenses), and help hemp farmers access grants and subsidies for agricultural growth.

Specialized Needs of Cannabis Businesses

Cannabis businesses require distinct accounting services to manage specific regulatory and operational challenges.

• Inventory Management: Precise inventory tracking and cost allocation are essential for compliance and accurate COGS reporting.
• Audit Preparation: State and IRS audits require robust internal controls, detailed records, and audit readiness.
• Tax Strategy and Compliance: Due to IRC §280E, cannabis CPAs focus on allocating allowable costs to COGS to minimize tax liability.
• Cash Management: Limited banking access necessitates effective cash management systems and partnerships with cannabis-friendly banks.