Can You Sell Marijuana Seeds

Information for the Cannabis Industry: How Tax Applies to Immature Plants, Clones, and Seeds Cultivation Tax The cultivation tax does not apply to the sale or transfer of immature plants, Exploring the cannabis seed paradox: cultivators must break the law in order to obtain seeds to grow legal cannabis. Can this issue be fixed? Learn how to start your own marijuana seed bank business in part 1 of our guide. Introduction to the formation of your own marijuana seed bank.

Information for the Cannabis Industry: How Tax Applies to Immature Plants, Clones, and Seeds

Cultivation Tax
The cultivation tax does not apply to the sale or transfer of immature plants, including clones or seeds. The cultivation tax is imposed on cultivators for harvested cannabis that enters the commercial market; however, the definition of “enters the commercial market” specifically excludes immature plants and seeds.

Excise Tax
Immature plants, clones, and seeds are subject to the 15 percent cannabis excise tax when sold at retail. Nurseries may sell immature plants, clones, or seeds to another cannabis licensee. However, a distributor is required to transport the cannabis from the nursery to the licensee and when the immature plants, clones, or seeds are sold or transported to a retailer, the distributor is also required to collect the 15 percent cannabis excise tax from the retailer based on the average market price of the immature plants, clones, or seeds. The retailer is responsible for collecting the cannabis excise tax from their retail customers when the immature plants, clones, or seeds are sold at retail.

Sales and Use Tax
Sales tax applies to the retail sale of immature plants, clones, and seeds. Sales and use tax does not apply to a cultivator’s purchase of immature plants, clones, and seeds when the products grown from them will be resold as part of the cultivator’s regular business activities. The seller should obtain and keep a valid and timely resale certificate from the purchaser as support that the sale was for resale. For information on sales for resale and resale certificates, see publication 103, Sales for Resale.

This email is intended to give you an overview of how tax applies to immature plants, seeds, and clones and does not address all requirements for the cannabis industry. For additional information, we encourage you to read our online Tax Guide for Cannabis Businesses, or contact the CA Department of Tax and Fee Administration.

The Cannabis Seed Paradox: Breaking The Law To Grow

You’ve seen our physicians at Green Health Docs . You have your certification. You’ve registered with the state and gotten proper authorization to grow medical cannabis at home. But then comes the cannabis seed paradox!

Find out what the cannabis seed paradox is below. And how cultivators get around it. (Hint: they break the law)

The Cannabis Seed Paradox

Once you have your home cultivation authorization, it’s time to start growing medical cannabis . But there’s one small hitch. Where the hell does one get seeds?

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Well, here’s the rub. Seeds are illegal. That is, it is illegal under federal law to move cannabis across state lines. This includes full grown plants, clones, seedlings or even seeds themselves. Yup, you read that right. Home cultivators will need to do something illegal in order to grow legal medical cannabis.

Some clinics and cultivation businesses may offer seeds for free, a quick and easy way for patients to bypass this hurdle. But literally thousands of Missouri medical marijuana patients will be stuck searching for places to buy seeds. And regardless of legality, many patients will try to buy or order seeds online in order to get a specific strain that caters to their medical needs.

Selling Seeds is Illegal, Online or in Missouri

Even retailers are walking a thin line when it comes to selling cannabis seeds in Missouri. Proper state authorization is required in order to sell cannabis products, like dry flower, edibles or oils . Products can only be sold to state medical marijuana patients. Seeds will likely not be sold in medical marijuana dispensaries, though that’s a possibility at some point.

Anyone selling seeds outside the medical marijuana arena is likely doing so without legal authorization. This puts their business at risk for penalty or punishment if caught.

Seeds sold online are typically sold in states or countries where cannabis is legal. However, shipping seeds in the mail is a federal crime. If you’ve ever been burned by purchasing seeds online, chances are your seeds were simply confiscated by authorities before making their way to your door.

Seeds online are also a crap-shoot. You may get that award-winning strain, or you may get some messed up hybrid that gives you the jitters. And worse, you won’t know until harvest. Buying online isn’t the best way to get seeds, but sometimes it’s the only option from some cultivators.

Bypassing the Law?

Even large scale cultivators will face the cannabis seed paradox. In order to begin their grows, they must either bring in seeds or clones from another state or country. As cannabis is still illegal under federal law, crossing the border or state lines constitutes of federal felony. Getting caught could result in severe legal punishment, possibly even jail time.

And yet, cultivators grow cannabis in every state with an active marijuana program. That means the law was broken with no real consequence. Seeds, after all, are fairly innocuous and difficult to detect. A pack of seeds could fit into a wallet, or even a small envelope with no trouble whatsoever. Seeds give off little to no smell, and are largely indistinguishable from hemp seeds. It is a crime to move seeds across state lines, but it’s an undetectable crime that doesn’t harm anyone. This is likely why it goes unpunished.

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Clones, on the other hand, are far easier to detect. Cannabis has a smell beginning around the first few leaves. The smell is surprisingly dank by this stage. Moving clones across state lines is a much riskier endeavor. Many cultivators will risk it, however, as it greatly speeds up the time to harvest. This means that patients get medical cannabis in their dispensaries much faster.

Legalizing Cannabis Seeds

Even if the federal government decides not to reschedule cannabis, removing it from the list of the most restricted drugs in the country, something must be done about the cannabis seed paradox. This issue affects every single state with a medical marijuana or recreational marijuana program.

Ohio faced this issue when their program launched in 2016. Maryland also faced this paradox a year earlier with their program. And this same paradox struck Michigan, Pennsylvania and Illinois. The list goes on…

Legalizing cannabis seeds and clones for authorized businesses and medical marijuana patients makes sense. It allows the federal government to properly track each sale of cannabis seeds and clones. This gives them a better sense of what is moving where, and when. This could also lead to better tracking of black market cannabis.

And let’s be real. Legalizing cannabis seeds and clones allows safe passage for those seeds and clones, and the employees entrusted with the task of moving them. There are a lot of noble botanists trying their best to bring good quality cannabis to medical marijuana patients. But those heroes are putting a lot on the line when moving seeds across state lines or borders. Legalization would protect them and allow these employees to do their job more efficiently.

Legal Seeds for Patients

Patients with proper home cultivation authorization should also be allowed to purchase and transport seeds or clones across state lines from authorized retailers. Full stop.

Seed and clone tracking, if necessary, could be done through the same database established for tracking medical marijuana purchased in the state at dispensaries. The state could even regulate high potency strains, if such a thing were cause for alarm.

Regardless, a medical marijuana patient deserves the freedom to legally grow their cannabis, and one of those stages is buying the actual plant itself. If a patient is allowed to grow cannabis, they should be allowed to buy cannabis seeds. The whole process should be legal, from seed to medication.

Getting Your Certification

In order to grow cannabis at home, a qualifying patient must first get a certificate to use medical cannabis. You can do so by seeing one of our licensed medical marijuana physicians at Green Health Docs in Missouri . They can help you get certified, and our support team can walk you through the home cultivation application process. To get started, simply call 1-877-242-0362 today! Patients can obtain a card either in-person at our Missouri clinics, or through online.

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How to Start a Marijuana Seed Bank Business Pt. 1

Expand your reach, connect your community, inspire a culture of cannabis growers. Simple, honest cannabis business fundraising and crowdfunding for the networked world.

How to Start a Marijuana Seed Bank Business Pt. 1

Learn how to start your own marijuana seed bank business in part 1 of our guide.

Introduction

A marijuana seed bank that sells marijuana seeds may ship the seeds into the United States and many other countries around the world. Marijuana seeds, also known as cannabis or weed seeds, are sold categorized by name, genetics, plant sex, and other attributes. A seed bank might simply collect the seeds for their own preservation; however, most seed banks tend to sell to consumers.

As of early 2020, hundreds of marijuana seed banks exist with websites that allow consumers to buy various cannabis seeds, shipped discreetly to their home or business address.

Certain marijuana seed banks only sell their own brand of seed strains. The large majority of marijuana seed banks sell seeds from other brands, or breeders.

Whether you decide to breed your own or simply resell, knowing the top breeders and most popular strains is crucial to understanding the wants of consumers.

Legal Aspects of Starting a Marijuana Seed Bank

Years ago, most of the marijuana seed banks registered their businesses in either the UK or the Netherlands. Both countries allow for the sale, possession, trade and purchase of cannabis seeds legally, although neither country permits cultivation of cannabis.

Today, Spain is the most popular place to start a cannabis seed bank, due to the legality of cannabis seeds and cultivation in Spanish law.

Whatever country you decide to open your marijuana seed bank business in, be sure to carefully consider the local regulations, state and federal laws before doing so.

Creating Your Seed Bank Website

The website for a marijuana seed bank must be able to display and categorize your products, allow customers to purchase the products and keep stock inventory.

An eCommerce CMS (content management system) is often used as the software for the online store. The most popular being WordPress, Magento and Shopify.

You may consider learning the software yourself or hiring a developer, although with seed banks especially you will want this to be someone you can trust.

Payment Processing

By far the most difficult aspect of running a marijuana seed bank website is credit card processing. Due to the high risk nature of the marijuana seeds business, most of the easiest methods will not work very long.

Many seed banks are in a constant state of finding better payment processing solutions. High risk merchant accounts for marijuana seed banks exist that may help with this, although for a considerable cost.

Buying cannabis seeds with Bitcoin is perhaps the easiest solution for marijuana seed banks to receive payment; however, only a small percentage of consumers pay with this option.