Instructions for Schedule Mc-2 - Medical Cannabis Sales

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Schedule MC-2 General Information
Who must file Schedule MC-2?
What products are considered bulk
medical cannabis for purposes of
If you are a medical cannabis cultivation center and you sell
medical cannabis to dispensing organizations, you must report
computing the tax?
your sales to each dispensing organization separately. You must
Bulk medical cannabis is cannabis intended for medicinal use
complete and attach Schedule MC‑2, Medical Cannabis Sales,
to your Form MC‑1, Medical Cannabis Cultivation Privilege Tax
• dried in its physical form to smoke; or
Return, to show the breakdown of sales to each dispensing
• in another physical form after extraction from the cannabis
organization.
plant, such as hash, ice wax, bubble hash, oil, wax, budder,
pie crust, taffy, shatter, nectar, caviar, and kief, regardless
How do I report my sales?
of how it is packaged or intended to be used; and
• not infused or combined with another product.
Follow the specific instructions on the following page to
report your sales. You must identify and report sales to each
What products are considered infused
dispensing organization separately.
medical cannabis for purposes of
How do I calculate the medical cannabis
computing the tax?
cultivation privilege tax?
Medical cannabis infused product is a product containing
Tax is due on medical cannabis sold by a cultivation center
cannabis, including
to a dispensing organization. The cultivation privilege tax is
• food and beverage products prepared for consumption;
calculated at a rate of 7 percent (.07) of the sales price per
• cooking oils;
ounce of medical cannabis.
• tinctures or tonics, such as sprays or drops;
• topicals, such as ointments, balms, oils, lotions, gels, or
Tax on a package of medical cannabis infused product is based
patches;
on the total weight in ounces of medical cannabis as shown
on the label required by 8 Illinois Administrative Code Section
• bath salts or oils; and
1000.420(e). For purposes of computing the tax on medical
• aromatherapy sprays or essences.
cannabis infused products, the sales price is the cultivation
center’s average sales price per gram of high grade cannabis
What if I need help?
flowers. This price shall be determined at the beginning of the
Visit our website at tax.illinois.gov, or call us weekdays
month and shall not change during the month.
between 8:00 a.m. and 4:00 p.m. at 217 782-6045.
The tax on a medical cannabis extract or concentrate is based
on the sales price of the quantity (in ounces or partial ounces)
of extract or concentrate sold by the cultivation center. The
quantity for purposes of the tax is actual weight of the extract or
concentrate contained in the package.
The medical cannabis sales price is determined without any
deduction on account of the cost of property sold, material
used, or labor or service or on account of any other expense
whatsoever. See 86 Illinois Administrative Code Section
130.415 for rules regarding transportation and delivery charges.
The cultivation privilege tax is computed on the sales price
of the medical cannabis sold after the application of any
applicable discounts.
There is no cultivation privilege tax on free samples of medical
cannabis given to a dispensing organization by a cultivation
center. However, a cultivation center incurs Use Tax liability on
the cost price of any free samples of medical cannabis given to
dispensing organizations. See 86 Illinois Administrative Code
Section 150.305(c).
MC‑2‑Instructions (R‑02/16)
Schedule MC-2 General Information
Who must file Schedule MC-2?
What products are considered bulk
medical cannabis for purposes of
If you are a medical cannabis cultivation center and you sell
medical cannabis to dispensing organizations, you must report
computing the tax?
your sales to each dispensing organization separately. You must
Bulk medical cannabis is cannabis intended for medicinal use
complete and attach Schedule MC‑2, Medical Cannabis Sales,
to your Form MC‑1, Medical Cannabis Cultivation Privilege Tax
• dried in its physical form to smoke; or
Return, to show the breakdown of sales to each dispensing
• in another physical form after extraction from the cannabis
organization.
plant, such as hash, ice wax, bubble hash, oil, wax, budder,
pie crust, taffy, shatter, nectar, caviar, and kief, regardless
How do I report my sales?
of how it is packaged or intended to be used; and
• not infused or combined with another product.
Follow the specific instructions on the following page to
report your sales. You must identify and report sales to each
What products are considered infused
dispensing organization separately.
medical cannabis for purposes of
How do I calculate the medical cannabis
computing the tax?
cultivation privilege tax?
Medical cannabis infused product is a product containing
Tax is due on medical cannabis sold by a cultivation center
cannabis, including
to a dispensing organization. The cultivation privilege tax is
• food and beverage products prepared for consumption;
calculated at a rate of 7 percent (.07) of the sales price per
• cooking oils;
ounce of medical cannabis.
• tinctures or tonics, such as sprays or drops;
• topicals, such as ointments, balms, oils, lotions, gels, or
Tax on a package of medical cannabis infused product is based
patches;
on the total weight in ounces of medical cannabis as shown
on the label required by 8 Illinois Administrative Code Section
• bath salts or oils; and
1000.420(e). For purposes of computing the tax on medical
• aromatherapy sprays or essences.
cannabis infused products, the sales price is the cultivation
center’s average sales price per gram of high grade cannabis
What if I need help?
flowers. This price shall be determined at the beginning of the
Visit our website at tax.illinois.gov, or call us weekdays
month and shall not change during the month.
between 8:00 a.m. and 4:00 p.m. at 217 782-6045.
The tax on a medical cannabis extract or concentrate is based
on the sales price of the quantity (in ounces or partial ounces)
of extract or concentrate sold by the cultivation center. The
quantity for purposes of the tax is actual weight of the extract or
concentrate contained in the package.
The medical cannabis sales price is determined without any
deduction on account of the cost of property sold, material
used, or labor or service or on account of any other expense
whatsoever. See 86 Illinois Administrative Code Section
130.415 for rules regarding transportation and delivery charges.
The cultivation privilege tax is computed on the sales price
of the medical cannabis sold after the application of any
applicable discounts.
There is no cultivation privilege tax on free samples of medical
cannabis given to a dispensing organization by a cultivation
center. However, a cultivation center incurs Use Tax liability on
the cost price of any free samples of medical cannabis given to
dispensing organizations. See 86 Illinois Administrative Code
Section 150.305(c).
MC‑2‑Instructions (R‑02/16)
Specific Instructions
Figure your privilege tax base
When completing this form, please round to the nearest dollar
by dropping amounts of less than 50 cents and increasing
Line 1a - Enter the number of bulk ounces sold to the
amounts of 50 cents or more to the next dollar.
dispensing organization. (Enter ounces to three decimal
places.)
Note: You must report your sales to each dispensing
organization separately.
Line 2a - Enter the number of ounces infused into products
sold to the dispensing organization. (Enter ounces to three
Enter your business’ Account ID and License number issued
decimal places.)
by the Illinois Department of Revenue at the top of each page.
Also provide the reporting period.
Line 4a - Enter the consideration received from the dispensing
organization for bulk ounces.
Cultivation center’s information
Line 5a - Enter the consideration received from the dispensing
Location code - Enter the location code of the cultivation
organization for ounces infused into products.
center, found on the certificate of registration, from which you
made sales of medical cannabis to the dispensing organization
Page totals
identified below.
Complete the page totals for each page. The sum of all
Dispensing organization’s information
combined Schedule MC‑2 page totals must equal the
corresponding lines on Form MC‑1.
Enter the identifying information for each dispensing
organization to which you made sales of medical cannabis
during the reporting period.
Account ID - Enter the Account ID (assigned by IDOR) of the
dispensing organization to which you made your sales.
Registry ID number - Enter the Registry ID number (assigned
by the Illinois Department of Financial and Professional
Regulation) of the dispensing organization to which you made
your sales.
Business name and address - Enter the name and physical
address of the dispensing organization to which you made your
sales.
MC‑2‑Instructions (R‑02/16)

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