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H.R. 1118House116th Congress (2019-2021)In Committee

Small Business Tax Equity Act of 2019

Sponsored by Earl BlumenauerRep. Earl Blumenauer (D-OR)
Introduced February 8, 2019

AI-Generated Summary

Updated April 14, 2026 at 1:41 AM UTC

The Small Business Tax Equity Act of 2019 changes the federal tax code so that businesses that sell marijuana legally under state law can claim ordinary business deductions and tax credits. Currently, Section 280E of the Internal Revenue Code blocks such deductions for any controlled‑substance trade. By adding an exception for state‑compliant marijuana sales, the bill aims to give these businesses tax treatment similar to other small businesses.

Key Provisions

  • Amends IRC Section 280E to insert an exception: deductions and credits are allowed for expenses related to marijuana sales that are conducted in compliance with state law.
  • The amendment takes effect for taxable years ending after the law is enacted.

Legislative Activity

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1 earlier action
HouseIntro Referral Latest Action

Referred to the House Committee on Ways and Means.

Ways and Means Committee

February 8, 2019

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HouseIntro Referral

Introduced in House

February 8, 2019

HouseIntro Referral

Referred to the House Committee on Ways and Means.

Ways and Means Committee

February 8, 2019

Bill Text

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Introduced in HouseIssued February 8, 2019

I

116th CONGRESS

1st Session

H. R. 1118

IN THE HOUSE OF REPRESENTATIVES

February 8, 2019

Mr. Blumenauer introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to allow deductions and credits relating to expenditures in connection with marijuana sales conducted in compliance with State law.

1.

Short title

This Act may be cited as the Small Business Tax Equity Act of 2019.

2.

Allowance of deductions and credits relating to expenditures in connection with marijuana sales conducted in compliance with State law

(a)

In general

Section 280E of the Internal Revenue Code of 1986 is amended by inserting before the period at the end the following: , unless such trade or business consists of marijuana sales conducted in compliance with State law.

(b)

Effective date

The amendment made by this section shall apply with respect to taxable years ending after the date of the enactment of this Act.