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Senators fighting bank regulation to make cannabusiness possible

(FINANCE NEWS) Despite the move towards legalization continuing to spread, state by state, legal marijuana businesses are faced with a lack of access to banks and credit unions.

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cannabusiness constellation

The spread of legalizaiton

The November elections saw a number of states decriminalize the purchase, possession, and consumption of marijuana, and it’s now legal in more than half the nation. However, despite the move towards legalization continuing to spread, state by state, we’ve written before about barriers to entry into the field, including a lack of access to banks and credit unions.

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“Good people don’t smoke marijuana”

Legal though it might be in some places, it’s still not a universally popular position that it ought to be, nor that ancillary businesses that support legal marijuana dispensaries ought to have access to banking. Jeff Sessions, the nominee for the Attorney Generalship and US senator from Alabama, has taken a vociferous and clear stance. Calling marijuana “dangerous” and commenting that “good people don’t smoke marijuana”, Sessions’ angst over the drug was noted as far back as 1986, when his bid for a federal judgeship was scuttled after testimony from Justice Department colleagues about his behavior while posted as the US Attorney in Mobile.

In direct testimony, Sessions was alleged to have joked that the Ku Klux Klan “was O.K. until I found out they smoked pot.”

If his position is clear, it’s not as if he’s been the only federal voice that’s not relented. In 2016, the Justice Department refused to both legalize it, or to reclassify it on the controlled substance chart, choosing to leave it as a Schedule I controlled substance, making it the legal equivalent of heroin. But while it’s illegal to possess it, current federal law prohibits the Justice Department from spending money for interdiction or prosecution efforts in states where it’s been legalized.

Legal, except for the profits

So, it’s federally illegal to possess it, but the Justice Department can’t do anything to enforce those laws in the states in which it’s illegal. In the states in which it’s legal, it’s legal, sure, but the profits from the businesses can’t be deposited in banks that hold a federal charter, so it’s an all-cash business. A Catch-22 for the 21st century, to be sure.

In late 2016, ten US senators sent a letter to the Acting Director of the Financial Crimes Enforcement Network (FinCEN), decrying the situation and identifying yet again the concerns that they have from their constituents, including both those directly involved in the marijuana business and those who aren’t, that restricting this segment of the business community to a cash-only trade “jeopardizes community safety, limits economic growth, and greatly expands the opportunity for tax fraud.”

“Most banks and credit unions have either closed accounts or simply refused to offer services to indirect and ancillary businesses that service the marijuana industry,” the letter stated.

“A large number of professionals have been unable to access the financial system because they are doing business with marijuana growers and dispensaries.”

Who is being affected?

These ancillary professions include vendors that work directly with the marijuana dispensaries, such as field chemists, security firms, attorneys, and repairmen alike. “Locking lawyers, landlords, plumbers, electricians, security companies, and the like out of the nation’s banking and finance systems serves no one’s interest,” the letter continued. Having these professionals unable to access bank accounts has become problematic for them as well, with some being placed in the unenvious position of having to choose between turning down business or finding themselves unable to go to the bank.

FinCEN and the Justice Department had provided guidance to the banking industry previously, in 2014, giving them the authority and ability to do business legally with the marijuana industry, but it hasn’t yet been universally adopted, nor, in the opinion of the senators, adequately addressed the additional issues that still surface.

Business is business

“These people are businessmen,” said Burton Marks. “Maybe they’re in a dirty business that you don’t like, but nevertheless they are in business.”

Marks’ comments came 33 years ago, in 1973, speaking to the US Supreme Court in his defense of Marvin Miller, who had been convicted of obscenity in California for his work as the purveyor of adult magazines and pictures.

The businesses are markedly different, but the sentiment is the same: it’s time that legal businesses were treated on morally neutral grounds and that protections that legal businesses enjoy were extended to all on a neutral basis.

#Cannibusiness

Roger is a Staff Writer at The American Genius and holds two Master’s degrees, one in Education Leadership and another in Leadership Studies. In his spare time away from researching leadership retention and communication styles, he loves to watch baseball, especially the Red Sox!

Business Finance

Easy tax calculator for freelancers that tend to wing it

(FINANCE NEWS) This tax calculator gives you an idea of what you should be holding back so tax day isn’t such a big surprise this time.

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The freelance checks are rolling and your income is adding up fast. Score!

Not so fast.

Your freelance checks are not taxed individually, but that doesn’t mean your income is tax-free. Whether you’re a full-time freelancer, part-timer, or just work on contract projects here and there, it’s important to know how much of your freelance income needs to go towards your tax bill.

As 2017 comes to a close, it’s a great time to review your project income and get an idea of what you may owe once taxes come due. Better to get a general idea now and start saving (if you haven’t already), than be blindsided when you fill out your tax forms.

To get a general idea of what you’ll owe, free tools such as The Freelance Project Tax Calculator can be helpful. This calculator, which is a collaboration between CPAs at Atribus Solutions and Sail, can be downloaded via email after submitting a request on the Sail website.

It’s compatible with Google Sheets and Excel, too, so use whichever spreadsheet program you prefer.

Whether you are completely self-employed or freelancing on the side, the Freelance Project Tax Calculator can help you determine the amount you should be saving for taxes. You’ll just have to share some general information about your filing status, location and projected income. It can also take project costs into account, allowing you to more accurately calculate net profit after deductions – and a good way to keep every aspect of each project organized.

If you are a freelancing newbie, toying with this calculator can also help you establish rates that allow your net income to be at the level you want (or need) it to be.

Now, keep in mind that this calculator provides rough estimates to get you started. If you want a more concrete number or in-depth financial advice, it’s time to find an accountant. But it never hurts to start planning ahead for tax expenses, and this tool can help you do just that.

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Business Finance

Should research papers remain behind a paywall or be fully accessible?

(FINANCE) Paywalls restrict 65% of research papers, but some argue it’s for good reasons. Others say the walls should come down.

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Paywalled research papers might be the current business model, but scientific research should be available to all, not just those who can pay for it.

In academia, published papers are part of the tenure process. You not only have to do research, publish papers, and hope that your work is cited in other research to get promoted.

Despite the notion that this research needs to be available to everyone, much of it is still behind a paywall. Josh Nicholson and Alberto Pepe estimated that about 65 percent of all cited papers are behind a paywall. Why is this important? They say it is because “some of the world’s most important scientific research is inaccessible from the majority of the world.”

A case for paywalls:
Publishing is big business. It takes a staff to manage a journal that publishes research. Essentially, someone has to pay. Most journals have chosen to charge the reader, because the alternative, charging the scientist for publication, is not a viable business model.

Publications that charge for access are generally considered more prestigious in academic circles. Thus, it’s safe to assume that the best research is published in paywalled journals. In my research for this article, I did learn that taxpayer-funded research through the NIH was supposed to be accessible to the public one year after it was published.

A case for open access:
Nicholson and Pepe averaged the cost of the paywalls at $32.33 for one access point. That is way too costly for a graduate student or an average individual (or journalist whose boss refuses to pay).

One key reason the internet was developed was to share research between scientists. Although universities often buy subscriptions to paywalled journals, most research is not accessible to the average person some four decades later. It’s been argued that research should be made public to hold scientists and the government accountable. Published research should be promptly and broadly disseminated, according to a policy statement made by the Bill & Melinda Gates Foundation.

Can the business model hold up?
The tide is slowly changing, but most say that it’s not quick enough. Some experts believe that the scientific publishing process is not a business model that can withstand the changing culture. I’m sympathetic to the publishers, but I’d like to see more scientific research available to individuals at a price point that makes sense.

It’s going to take a shift in attitude at many levels to see change. Scientists need to utilize open access journals. Universities need to change policies. Publishing journals need to look at their business model. The generation that wants change is not in a position to make that change, but in a few years, they may be.

We can only hope that they find a new process to allow everyone access.

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Business Finance

Square tests buying and selling bitcoin inside its payment app

(FINANCE NEWS) Cryptocurrency lovers rejoice, you can now buy, sell, and store bitcoin in your Square wallet.

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Recently, Square rolled out a special new feature to select users, allowing them to store bitcoin in-app. Square Cash started moving away from immediate transactions when the company released Cash Drawer in February of 2016, allowing users to stash currency in a digital wallet for later use.

Now, Square has dubbed some of its Cash users chosen ones, giving them the ability to buy, sell, and store bitcoin. Unlike Cash Drawer, users do not yet have the option to send bitcoin to others.

Those with the new feature can simply swipe right from the Cash Card page to buy and sell bitcoin – the screen also compares the current price of bitcoin against the U.S. dollar with a handy graph.

A Square spokesperson noted, “We’re exploring how Square can make this experience faster and easier, and have rolled out this feature to a small number of Cash app customers. We believe cryptocurrency can greatly impact the ability of individuals to participate in the global financial system and we’re excited to learn more here.”

Bitcoin is the most popular kid in school right now when it comes to rise in popularity. In January, the currency was valued at $1000 per unit, but is now flirting with the $10,000 milestone. Users that opted in to the new feature rejoiced on Twitter, making this a marketing plus for CEO Jack Dorsey who also heads Square.

However, not everyone is so optimistic.

This Monday, BTIG analyst Mark Palmer expressed concerns about Square Cash adding the bitcoin feature, noting it adds an unnecessary risk to users. Palmer downgraded Square from Neutral to Sell, setting a $30 target for the stock.

Other investors aren’t so keen on the volatile cryptocurrency making its way into Square. Mark Tepper, CEO of Strategic Wealth Partners, said in the long run, Square won’t be able to support bitcoin. “Square has a good track record of losing money, and there’s just no clear path to profitability in the near future,” Tepper noted on CNBC.

Despite these concerns, this cryptocurrency remains wildly popular. And Jack Dorsey has just made it significantly easier to people to purchase the cryptocurrency. Of course, investing in an unregulated market is risky, so if you’re one of the few with Square’s new bitcoin feature, proceed with caution. But also feel free to brag that you’re a chosen one.

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