U.S. Congress: Bicameral Bill to Keep Marijuana Tax Penalties Intact Even After Rescheduling Gains 14th Sponsor

OG article by Anthony Martinelli

February 11, 2026

A bicameral congressional bill to preserve tax penalties on marijuana businesses even after potential rescheduling has gained its 14th sponsor, Rep. Michael Lawler (R-NY). The House version (H.B. 1447), led by Rep. Jodey Arrington (R-TX), now has 12 Republican sponsors, with the Senate companion (S. 471) contributing to the total. The legislation amends the Internal Revenue Code to maintain ineligibility under Section 280E for standard deductions like rent, utilities, and wages if marijuana moves from Schedule I to Schedule III. This would override the typical tax relief from rescheduling. The push aligns with recommendations from the U.S. Department of Health and Human Services and comes amid President Donald Trump's executive order directing rescheduling, with a DEA decision expected soon. Proponents aim to prevent marijuana operators from accessing deductions available to other industries, keeping financial burdens intact despite any schedule change. The all-Republican support reflects ongoing GOP efforts to limit benefits for the cannabis sector in federal tax policy.