In its March newsletter, the California Franchise Tax Board announced its policy for cannabis clients that are only able to pay their tax obligations with cash. Because of the difficulties with opening or maintaining bank accounts for marijuana related business, many taxpayers in the cannabis industry are only able to pay their obligations with cash. The FTB reminds that, in general, it has a no cash policy and provides a link to its payment options page. However, the FTB recognizes that some taxpayers may experience a hardship if required to pay by means other than cash. Those taxpayers may apply for an exemption to the no cash policy using FTB Form 3711.
Once the exemption application has been received, the FTB will respond in writing within 2 business days. If approved, the taxpayer or their representative may then contact the nearest FTB field office to schedule an appointment to make the cash payment. Requests for appointments need to be made at least 2 business days prior to the date you wish to make the payment.
If the taxpayer is required to make mandatory e-payments, we recommend that you also complete and submit Form 4107, Mandatory e-Pay Election to Discontinue or Waiver Request for individuals, or Form 3816, Electronic Funds Transfer Election to Discontinue or Waiver Request for business entities, each time a cash payment is made.
Tax attorneys at Holtz, Slavett & Drabkin, APLC, represent cannabis industry clients in tax disputed and ta related matters with the IRS and state tax authorities. To schedule a consultation, please contact us at (310) 550-6200.