Federal Rescheduling Order Moves State-Licensed Medical Cannabis to Schedule III

The Controlled Substances Act has listed marijuana as Schedule I since 1971. In August 2023 HHS recommended moving it to Schedule III, citing medical use and lower abuse potential. President Donald Trump’s Dec 18 2025 Executive Order 14370 directed the Attorney General to complete rescheduling quickly. A notice of proposed rulemaking was published May 21 2024, drawing about 43,000 comments, but the process stalled.

Marijuana Rescheduling Notice Posted to Federal Register, Hearing Set for June 29

On April 22 2026 Acting Attorney General Todd Blanche signed a final order moving two cannabis categories to Schedule III: (1) FDA-approved drug products containing marijuana and (2) marijuana produced under a state medical-marijuana license. The order relies on 21 U.S.C. § 811(d)(1), allowing scheduling without notice-and-comment to meet treaty obligations under the Single Convention. The DEA set a hearing to begin June 29 2026 at 9 a.m. ET in Arlington, Virginia, concluding by July 15.

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The Schedule III classification removes Section 280E’s disallowance of ordinary business deductions for state-licensed medical operators, potentially reducing tax rates. The order creates an expedited DEA registration pathway: entities with a qualifying state medical license may submit that credential as conclusive evidence, and applications filed by June 22 2026 receive priority processing. The rescheduling applies only to FDA-approved products and state-licensed medical cannabis; recreational use, synthetic THC and hemp remain Schedule I, and banking and criminal penalties unchanged.

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The Justice Department said the order places FDA-approved marijuana products and state-licensed medical cannabis into Schedule III. The DEA announced the June 29 hearing will evaluate whether all cannabis should be moved to Schedule III. Treasury was urged to consider retroactive relief from Section 280E for affected tax years.

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Twenty-two Republican senators and twenty-six House Republicans urged the administration to abandon the rescheduling. Smart Approaches to Marijuana retained Bill Barr to challenge the order, arguing the treaty-exception pathway was improperly used. MAPS co-executive director Betty Aldworth warned the move does not resolve cash-only operations or broader legal contradictions.

DOJ Immediately Reschedules State-Licensed Medical Cannabis to Schedule III — and Restarts the Clock on Broader Rescheduling

Some sources state the order does not provide retroactive Section 280E relief, while others note it encourages the Treasury to consider such relief, leaving the actual tax treatment for prior years unclear.

DEA Issues Long Awaited Final Order Rescheduling Certain Marijuana Products to Schedule III: What It Means, What It Doesn’t, and What Comes Next

• “The Department of Justice is delivering on President Trump's promise to expand Americans' access to medical treatment options,” — Todd Blanche, Acting Attorney General

Trump administration moves state-licensed MMJ to Schedule III

• “This rescheduling action allows for research on the safety and efficacy of this substance, ultimately providing patients with better care and doctors with more reliable information.” — Todd Blanche, Acting Attorney General

Trump administration moves state-licensed MMJ to Schedule III

• “This order places two specific categories into Schedule III: FDA-approved drug products containing marijuana and marijuana produced under a qualifying state medical marijuana license,” — Terry Mendez, CEO, Safe Harbor Financial

Trump administration moves state-licensed MMJ to Schedule III

• “Rescheduling is a step in the right direction, not a solution,” — Betty Aldworth, Co-Executive Director, MAPS

Trump administration moves state-licensed MMJ to Schedule III

Applications for expedited DEA registration must be filed by June 22 2026. The June 29-July 15 hearing will shape a potential final rule on broader rescheduling, with a likely issuance in late 2026.

Marijuana Rescheduling Notice Posted to Federal Register, Hearing Set for June 29