Highly Regulated Industries where every number is evidence.
Accounting, tax, and payroll for cannabis, hemp, tobacco and nicotine, and other regulated product businesses, from one team that keeps your books ready when a regulator or the IRS asks how you got your numbers.
In highly regulated industries, one inventory record answers to several audiences: the state agency that licensed you, the tax agency that collects your excise, and the IRS reviewing your cost of goods sold. When those records disagree, any of them can notice. TreeStar Solutions is an EA-led firm headquartered in Chico, California, and regulated product businesses are central to our work, with cannabis as a core specialty. Bookkeeping, payroll, tax, and advisory run from one set of books, so the count on your shelves, the figure on your excise return, and the inventory on Form 1125-A tell the same story.
Where it gets complicated
- 01 Federal and state law split
Cannabis and psilocybin remain controlled substances under federal law, even where states license and tax them. That split shapes which deductions survive, how banks treat you, and why federal and California returns differ.
- 02 Rules in motion
Cannabis rescheduling is moving in stages, federal law has narrowed the definition of hemp, and California's flavored tobacco restrictions changed what many retailers can stock. A plan built on last year's rules can be out of date by the time you file.
- 03 Inventory under three lenses
Track-and-trace or licensing records, excise filings, and your tax return each measure inventory in their own way. Gaps between them are where exams, penalties, and restatements tend to start.
- 04 Multi-agency reporting
Regulated products often carry excise taxes and license reporting with agencies such as CDTFA and, for tobacco manufacturers and importers, the federal TTB. Every one of those filings draws on your books, so a weak month-end shows up everywhere at once.
- 05 Cash and limited banking
Many cannabis operators still handle significant cash and work with a short list of banks willing to serve them. That raises the bar for cash controls, deposit records, and the paper trail an examiner expects to see.
Explore Highly Regulated Industries
Cannabis accounting and tax for state-licensed operators, single license or vertically integrated, from a team that builds your cost of goods sold to hold up under §280E.
→ cannabis_cultivation Cannabis Cultivation
Cannabis cultivation accounting for licensed growers who need every harvest batch costed, every crop cycle tracked, and a COGS figure that reflects what it took to grow.
→ cannabis_manufacturing Cannabis Manufacturing
Cannabis manufacturing accounting for extractors and infused product makers who need input costs, yields, and lot-level margins they can rely on.
→ cannabis_distribution Cannabis Distribution
Cannabis distribution accounting for licensed distributors who move, test, and wholesale product and need transfers, margins, and receivables that reconcile.
→ cannabis_retail Cannabis Retail
Dispensary accounting for licensed cannabis retailers who need POS sales, cash, excise, and inventory to agree every day, and a tax return built on the narrow cost of goods sold a reseller is allowed.
→ hemp Hemp
For compliant hemp farms, processors, and brands. Hemp accounting that keeps each product line classified, inventory valued realistically, and the books ready as federal rules tighten.
→ tobacco_nicotine Tobacco & Nicotine
For tobacco, vape, and nicotine brands, retailers, distributors, and wholesalers. Books that tie excise and license reporting to real inventory, in a business where margins leave little room for error.
→ psychedelics Psychedelics
For state-licensed psilocybin and natural medicine businesses. Careful books and measured tax planning for an industry that operates under state programs while remaining Schedule I federally.
→ regulated_products Regulated Product Businesses
For businesses whose products come with licenses, excise taxes, or agency reporting. One set of books that can answer every regulator who asks.
→ 280e_cannabis_tax 280E & Cannabis Tax
280E tax help for cannabis operators who want cost of goods sold calculated correctly, medical and adult-use activity documented, and returns they can stand behind.
→ inventory_cost_accounting Regulated Inventory & Cost Accounting
For licensed operators whose inventory is counted twice: once for the regulator and once in the books. We make the two agree and build cost of goods sold that holds up.
→ accounting_compliance Regulatory Accounting & Compliance
For licensed and regulated businesses that want to be ready for an examination in any month of the year, not just the month one arrives.
→How TreeStar helps
We set up QuickBooks Online around your licenses, product lines, and inventory flow, so the chart of accounts mirrors how regulators and tax agencies look at your business.
→ inventory_accounting Support cost of goods soldWe document inventory costing and COGS within the inventory rules that apply to your activity, so the figure on your return is backed by records rather than estimates.
→ tax_planning Plan ahead of rule changesWe model how cannabis rescheduling, the new hemp definition, and changing excise or product rules may affect your taxes and cash, then revisit the plan as guidance arrives.
→ irs_representation Represent you before the IRSOur Enrolled Agents can represent you before the IRS and, where permitted, state tax agencies, working alongside your attorney and compliance team.
→What you can expect
Inventory that ties from license records to the return
Federal and state differences tracked, not guessed
Earlier warning when a rule change touches your numbers
Common questions
Do you only work with cannabis businesses?
No. Cannabis is a core specialty, and we also work with hemp, tobacco and nicotine, and other regulated product businesses. What they share is inventory-heavy books, excise and license reporting, and tax rules that leave little room for loose records.
Do you handle licensing or legal compliance?
No. TreeStar brings the accounting, tax, and payroll side, and we work alongside your attorney and compliance team so the numbers they rely on are accurate and current.
Can you work with regulated businesses outside California?
Yes. We are based in Chico with offices in Garberville, Sacramento, and San Francisco, and we serve clients nationwide. Rules for regulated products vary widely by state, so we confirm the rules where you operate before planning around them.
Need a referral?
We work alongside the attorneys, consultants, and other specialists your industry relies on. Tell us what you need and we will make an introduction.
Licensing, entity structure, contracts, and regulatory questions.
→ request_referral Metrc and track-and-trace specialistSetup, cleanup, and training so the system matches the shelf.
→ request_referral Compliance consultantStandard operating procedures, inspections, and state and local readiness.
→ request_referral Insurance brokerCoverage for product, property, crops, and liability in regulated markets.
→ request_referral Banking and payment solutionsInstitutions and processors that serve licensed operators.
→Highly Regulated Industries insights
Six what-if scenarios for regulated businesses, from a banned product to a lost processor: what breaks first, the warning signs, and the first moves.
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Regulation is a variable, not a constant. How to model ranges, scenarios, triggers, and reserves for rules that keep moving.
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Medical cannabis moved to Schedule III. Licensing, track-and-trace, testing, excise tax, banking, and state lines did not. What each layer still costs.
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