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Schedule III may represent progress for parts of the cannabis industry, but it does not eliminate the retirement plan barriers facing adult-use operators. Federal illegality, Section 280E, and ongoing provider compliance concerns continue to limit access to traditional 401(k) solutions—making customized retirement strategies, including ESOPs in appropriate cases, more important than ever.
Despite renewed optimism surrounding federal rescheduling discussions, IRC §280E remains fully applicable to cannabis businesses today. Marijuana is still classified as a Schedule I substance, no final federal rule has been published moving it to Schedule III, and the IRS has explicitly reaffirmed that §280E continues to apply. Courts have consistently upheld the statute, and Congress has not enacted repeal legislation. Pending litigation — including New Mexico Top Organics — does not change compliance obligations for the broader industry.
At Trust Integritas, our guidance is grounded in enforceable law, not speculation. Businesses disregarding §280E are assuming audit risk, potential penalties, and interest exposure. While reform may eventually arrive, hope is not a compliance strategy. Until substantive legal change occurs, maintaining strict compliance with §280E remains the prudent and defensible position.