DEA Registers 900+ Medical Marijuana Dispensaries, Opening Path to Federal Tax Deductions

The U.S. Drug Enforcement Administration issued its first registrations to medical marijuana dispensaries on Friday, granting more than 900 state-licensed shops in seven states access to federal tax deductions long denied the industry. The Justice Department said registrations went to dispensaries in Alabama, Florida, Mississippi, South Dakota, Texas, Virginia and West Virginia. The move follows an April order by Attorney General Todd Blanche reclassifying state-licensed medical marijuana from Schedule I to Schedule III. Registration allows businesses to deduct ordinary expenses such as rent, advertising and labor on federal taxes — a benefit previously barred because cannabis was federally illegal. Roughly 7,000 other dispensaries, manufacturers and distributors have applied, according to a DEA list published Friday. Uncertainty remains over how the DEA will regulate cannabis businesses, including those with operators holding criminal records and shops selling both medical and adult-use products. Two dozen states plus Washington, D.C., have authorized recreational marijuana; 40 states have medical programs.