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S. 422Senate116th Congress (2019-2021)In Committee

Small Business Tax Equity Act of 2019

Sponsored by Ron WydenSen. Ron Wyden (D-OR)
Introduced February 7, 2019

AI-Generated Summary

Updated April 14, 2026 at 1:29 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. Previously, Section 280E barred such deductions for any marijuana‑related trade. The bill would let compliant marijuana businesses treat their expenses like any other small business, affecting dispensaries, growers, and related companies that operate in states where marijuana sales are legal.

Key Provisions

  • Amends Internal Revenue Code Section 280E to add an exception: deductions and credits are allowed for marijuana sales that comply 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
SenateIntro Referral Latest Action

Read twice and referred to the Committee on Finance.

Finance Committee

February 7, 2019

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SenateIntro Referral

Introduced in Senate

February 7, 2019

SenateIntro Referral

Read twice and referred to the Committee on Finance.

Finance Committee

February 7, 2019

Bill Text

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Introduced in SenateIssued February 7, 2019

II

116th CONGRESS

1st Session

S. 422

IN THE SENATE OF THE UNITED STATES

February 7, 2019

Mr. Wyden (for himself, Mr. Paul, Mr. Bennet, and Mrs. Murray) introduced the following bill; which was read twice and referred to the Committee on Finance

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.