Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
rowancd
New Member

Medical marijuana grower business code in oklahoma

 
10 Replies
Critter-3
Level 15

Medical marijuana grower business code in oklahoma

You will need to decide that for yourself as there is none for the federal return that is just for your business ... so do you grow or just sell ?   Look at the charts for the Sch C  on pages 17-18. 

 

https://www.irs.gov/pub/irs-pdf/i1040sc.pdf

Critter-3
Level 15
mesquitebean
Level 15

Medical marijuana grower business code in oklahoma

If you are asking about a Federal return and the business code on a quick NAICS search I just did turns up 4 business codes with the subject of marijuana.   I'll provide the links below for your perusal.

 

111998   "Marijuana, grown in an open field" is under "all other miscellaneous crop farming."

https://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=111998&search=2017%20NAICS%20Search

 

111419 "Marijuana, grown under cover" (glass or protective cover.)

https://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=111419&search=2017%20NAICS%20Search

 

424590  "Marijuana merchant wholesalers" under "Other Farm Product Raw Material Merchant Wholesalers"

https://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=424590&search=2017%20NAICS%20Search

 

453998  "Marijuana stores, medical or recreation"  under "All other miscellaneous store retailers."

https://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=453998&search=2017%20NAICS%20Search

 

mesquitebean
Level 15

Medical marijuana grower business code in oklahoma

@ rowancd 

Or are you preparing Schedule F (Farming)?

When I mentioned those 4 business codes above, I originally mentioned "Schedule C" but removed it, since I'm not sure exactly what form you are referring to--Sch F or Sch C.   The term "Business code" implies Sched C, but you may be referring to Schedule F (Farming) where it asks for "Principal crop or activity."

 

If you are preparing Schedule F, it has a choice of more general codes, such as 111900 "Other crop farming" or 111400 Greenhouse production.  See the back (Page 2- Part IV) of a Schedule F at this link

https://www.irs.gov/pub/irs-pdf/f1040sf.pdf

 

Whether to use a general code on Sched F or Sched C or a more specific code as I mentioned earlier is up to you.    If you're preparing Schedule F, the Schedule F itself and the Schedule F Instructions just ask for one of the general agricultural codes listed on the back (page 2).

AmeliesUncle
Level 12

Medical marijuana grower business code in oklahoma


@mesquitebean wrote:

 the business code on a quick NAICS search


 

The IRS does not want the NAICS code.  They want the Principal Business Code, which is in the Instructions.  Although those codes are based on NAICS, the are more broad.  Find and use the code in the Instructions that is closest (looking up the NAICS code can give you the first three digits, which will help you narrow down which IRS code to use).

mesquitebean
Level 15

Medical marijuana grower business code in oklahoma


@AmeliesUncle wrote:

The IRS does not want the NAICS code.  They want the Principal Business Code, which is in the Instructions.  Although those codes are based on NAICS, the are more broad.  Find and use the code in the Instructions that is closest (looking up the NAICS code can give you the first three digits, which will help you narrow down which IRS code to use).

User has not mentioned what Schedule he/she is referring to--F (Farming) or C (self-employed business), so it's not clear if he/she is using the correct Schedule.   The use of the term "business code" as opposed to "agricultural activity code" suggests user may be using Schedule C.  The IRS says if his principal source of income is from farming activities, he should be using Schedule F, not C. 

 

If user is preparing Schedule F, then as I mentioned above, the possible agricultural activity codes on a Schedule F (farming) are more general and more obvious.   The few possible choices for Schedule F can be seen on the back of the Schedule F (page 2, part IV) at the link I provided above.    When preparing a TurboTax return, in the Schedule F interview these agricultural activity codes are limited and chosen from a dropdown list in both Online TurboTax and the desktop software.  The code for Schedule F has to be chosen from that dropdown list of general codes.  So there is no way to manually enter a different code for Schedule F other than those few in the dropdown list anyway. 

 

Since this user is asking about entering a "business code," it makes me wonder as to which Schedule he is preparing, and if it's the correct one.  If  user is preparing Schedule F, he should have seen that limited dropdown list of general agricultural codes and is limited to those.  If he is not seeing the limited dropdown list of agricultural codes and is given a field to enter all 6 digits, perhaps he/she is instead referring to a Schedule C business for some reason.  

 

@rowancd 

mesquitebean
Level 15

Medical marijuana grower business code in oklahoma

User also mentioned "Oklahoma" in the question title, and I'm not sure why.  I'm not sure if he/she is asking about the Federal return interview or if there's something user is being asked to indicate on an Oklahoma state return.   I'm a fellow user, not a tax person, so can't help with anything specific to a particular state return.-

rowancd
New Member

Medical marijuana grower business code in oklahoma

So I am using schedule C, this is a side business not primary and prior to seeing this response, I entered the code suggested for growing undercover (not in open field)  and proceeded to file... uggg so now with that what problems can I expect, by an incorrect code. I am near distraught at this point

AmeliesUncle
Level 12

Medical marijuana grower business code in oklahoma

The code is not very important, so don't worry about it.

 

However, are you aware of the ins-and-outs for taxes for a marijuana business?  Currently, Federal law prohibits any deductions on the Federal return other than Cost of Goods Sold.  So that would be your only deduction on the Federal return.  But assuming it is legal in your State, most likely you are able to take other business deductions on your State return.  Generally, it best to go to a tax professional that knows the ins-and-outs of such a business.

Critter-3
Level 15

Medical marijuana grower business code in oklahoma

In my opinion, since you grow a product, I would delete the Sch C and put everything on a Sch F.  

Dynamic AdsDynamic Ads
Privacy Settings
v