Expert Tips from a Cannabis Accountant: Naomi Granger’s Journey

In a recent episode of the Concierge CPA podcast, Jackie Meyer, CPA, President, and Founder of TaxPlanIQ, conversed with Naomi Granger, co-founder of the National Association of Cannabis Accounting and Tax Professionals (NACAT Pros). This discussion provides an illuminating look into the world of cannabis accounting, offering critical insights for accountants contemplating this niche.

You can listen to the full episode here, or on your favorite podcast platform.

The Path to Cannabis Accounting

Naomi Granger's journey into the cannabis industry began in 2017 when she saw the rapidly expanding legalization and recognized a unique opportunity. Her extensive background in accounting, including roles in public accounting firms and corporate settings, laid a strong foundation for her venture into cannabis accounting. Naomi emphasized the importance of niching down in the accounting profession to build expertise and scale effectively, a strategy that has significantly benefited her career.

Challenges and Opportunities for Cannabis Accountants

One of the key challenges Naomi highlighted is the complex and often ambiguous regulatory environment. Cannabis remains a Schedule I substance under federal law, complicating tax and accounting practices due to Section 280E of the Internal Revenue Code. This provision disallows operating expense deductions for businesses trafficking controlled substances, placing a significant financial burden on cannabis businesses.

Naomi shared that many cannabis accountants initially felt overwhelmed by the lack of clarity and guidance in this evolving industry. However, she stressed that this challenge presents a substantial opportunity for accountants to provide much-needed expertise and support. The burgeoning cannabis market is severely underserved, creating a high demand for knowledgeable accountants who can navigate these complexities.

Overcoming Stigma and Building Trust

Despite the growing acceptance of cannabis, stigma still lingers, particularly among conservative professionals like accountants. Naomi recounted numerous instances where individuals initially opposed to cannabis changed their perspectives after personal experiences or witnessing the medical benefits of cannabis for loved ones. She advocates for a more open-minded approach, encouraging accountants to consider the broader implications and benefits of the cannabis industry.

Latest Developments in Cannabis Tax Law

Naomi provided an update on the latest developments in cannabis tax law, particularly the potential rescheduling of cannabis from Schedule I to Schedule III. This change, recommended by the Health and Human Services Administration and pending approval from the DEA, could significantly alter the tax landscape for cannabis businesses. While the exact timing and details of the implementation remain uncertain, the industry is poised for transformative changes that could alleviate some of the current financial burdens.

Educating and Empowering Accountants

Naomi's passion for education led her to establish NACAT Pros, where she provides training and resources for accountants entering the cannabis industry. Her certification program, "Calculating Cannabis," offers an eight-week deep dive into the intricacies of cannabis accounting, covering everything from state regulations to standard operating procedures for cash and inventory management. This program aims to equip accountants with the knowledge and confidence needed to serve cannabis clients effectively.

The Future of Cannabis Accounting and Tax Planning

Looking ahead, Naomi sees immense potential in the cannabis industry, not just for financial growth but also for social equity. She believes that accountants can play a pivotal role in shaping the future of this industry by advocating for fair regulations and supporting businesses through expert guidance. Her work underscores the importance of staying informed and adaptable in an industry characterized by rapid changes and uncertainties.

Leveraging TaxPlanIQ for Growth

As the cannabis industry continues to evolve, tools like TaxPlanIQ can help accountants navigate these complexities and provide high-value services to their clients. TaxPlanIQ's robust platform allows accountants to create custom-branded tax plans, showcase potential tax savings, and access curated tax strategies with ease. By leveraging such tools, accountants can grow their firms, enhance client satisfaction, and position themselves as experts in the burgeoning field of cannabis accounting.

Sign up for a free demo of TaxPlanIQ today and discover how it can help you elevate your tax firm to new heights.