Cannabis Business Entity Formation and Startup
Cendrowski Corporate Advisors can help cannabis businesses with entity selection and company formation, critical decisions from both legal and tax planning perspectives.
In just one example of how important those decisions are, each license is exclusive to the licensee in Michigan, and conveyance of interest of more than 1% is prohibited without prior board approval. It is essential to determine the license ownership upfront, as changes down the road require additional regulatory scrutiny.
The Medical Marijuana Facility Licensing Act (MMFLA) and the Michigan Department of Licensing and Regulatory Affairs (LARA) require licensees to develop and maintain accounting and inventory control systems specific to the state’s regulations. Depending on the type and size of the business, these might be reasonably simple, or they could be more complex.
Accounting Procedures and Systems for Cannabis Sales
For startup entities, Cendrowski Corporate Advisors can provide the basic building blocks to set up and organize the business, including monthly checklists, accounting procedures, and templates for an accounting system. We can access critical information to inform decisions related to the initial application, accounting, and tax return preparation in the future, including 280E considerations.
Cannabis Product Inventory Control Procedures
For cannabis businesses, the state of Michigan requires a third-party inventory control system that can interface with the statewide monitoring system. Cendrowski Corporate Advisors can help develop these procedures to ensure inventory data is accurately captured for compliant reporting to the state.