New Jersey’s nascent legalized cannabis industry is set to see some much-needed tax relief. 

Under a law signed May 8 by Gov. Phil Murphy, the state’s corporate business tax provisions will be decoupled from federal rules prohibiting deductions and credits for cannabis businesses, ultimately allowing licensed cannabis companies in New Jersey to deduct certain expenses on state tax returns.

According to Section 280E of the Internal Revenue Service (IRS) code, cannabis-related ventures are blocked from deducting typical business expenses on state and federal tax returns since marijuana is classified as a Schedule I narcotic by the federal government.

The measure, which was sponsored by Assemblymembers Annette Quijano, D-20th District; Clinton Calabrese, D-37th District; and Linda Carter, D-22nd District, was approved Feb. 27 by the Assembly in a 59-8 vote.

Companion legislation by state Sens. Troy Singleton, D-7th District, and Shirley Turner, D-15th District, also passed the same day in a 32-3 vote.

Following the May 8 bill signing, Singleton said, “We have seen here in New Jersey, and around the country, that legal cannabis businesses tend to lack diversity both in gender and race amongst its ownership ranks. This law aims to level the playing field for all cannabis businesses.” [Read More @ NJBIZ]