The IRS has told California's largest provider of cannabis that it doesn't qualify for normal deductions, but a U.S. congressman is trying to change that

The slick video above is a testament to the professionalism and savvy of the folks at the Harborside Health Center, the largest medical marijuana dispensary on the West Coast. They're popular in their community, Oakland, among both their 83,000 members and city officials who appreciate the $1,081,450 tax bill the nonprofit organization recently paid into municipal coffers. But Luigi Zamarra, Harborside's chief financial officer, says that a tax problem with the IRS may force the operation to shut its doors if the federal agency's current ruling stands.

At issue is whether Harborside should be able to write off expenses as any other business would, or if selling marijuana changes everything. The Bay Citizen explains the specifics in its coverage. "The IRS insists that medical marijuana dispensaries must obey a section of tax code that prohibits companies from deducting most expenses if they are 'trafficking in controlled substances.' The section, 280e, was designed as a tool for fighting drug trafficking," writes reporter Zusha Elinson. "Zamarra said that the IRS letter states that Harborside can't deduct rent, payroll, health insurance or worker's compensation insurance -- deductions that are standard for many other industries. The only two things the IRS says the dispensary can deduct are the cost of buying marijuana and the cost of alternative health care services such as yoga, he said."