FTB 4020 I own a cannabis business. Where do I find tax information? New: 10/2017

Income tax

California taxes its residents on all income, including income from cannabis business activities. California taxes non-residents on income from California sources. All income apportioned to California by business entities is taxable. Income from entities organized as not-for-profit is also taxable.

For information about California income tax for cannabis business activities, visit our Cannabis page.

Sales, use, and cannabis taxes

If you operate a cannabis business in California, you generally are required to register and file tax returns with the California Department of Tax and Fee Administration.

For information about the requirements that apply to your business, view the Tax Guide for Cannabis Businesses at cdtfa.ca.gov/Industry/Cannabis.htm.

Payroll taxes

California businesses that hire employees to perform services are required by law to withhold, report, and pay payroll taxes.

For information about cannabis industry payroll tax and reporting, visit edd.ca.gov/Cannabis.

Payment options

Generally, state agencies do not accept cash payment for taxes. If paying in cash is necessary to avoid undue hardship, you may request an exemption. Go to the applicable state department website on SIDE 1 for more information.

Recordkeeping

California law requires that you keep accurate and complete documentation to support all business activities.

Additional information for your cannabis business

Local licensing

Cannabis businesses must get any required licenses and permits from their city or county government prior to applying for a state license.

State licensing agencies

Bureau of Cannabis Control

License types: testing laboratories, distribution, retail, micro-businesses:

Website

bcc.ca.gov

CalCannabis cultivation licensing, California Department of Food and Agriculture

License type: Cultivation

Website

https://cannabis.ca.gov/

California Department of Public Health

License type: Manufacturing

Website

cdph.ca.gov

Other resources:

Websites

cannabis.ca.gov
businessportal.ca.gov
bizfile.sos.ca.gov
taxes.ca.gov