On April 23, 2026, the Trump administration officially moved FDA-approved marijuana products and marijuana products regulated under qualifying state medical marijuana licenses from Schedule I to Schedule III under federal law. If you’re trying to understand what that actually means — for dispensaries, patients, cannabis businesses and federal policy — this is the explainer. For the full breaking news, read our coverage here.
What did the Trump administration actually do?
Acting Attorney General Todd Blanche signed an order moving two categories of marijuana into Schedule III of the Controlled Substances Act: FDA-approved drug products containing marijuana, and marijuana products regulated under a qualifying state medical marijuana license. The action was announced by the Department of Justice on April 23 and follows a December 18, 2025 executive order in which President Trump directed the DOJ to complete the reclassification “in the most expeditious manner possible.”
Blanche used a specific legal authority, a provision allowing the attorney general to classify drugs the U.S. must regulate under international treaty obligations, to bypass the stalled DEA rulemaking process that had dragged on since the Biden administration. That prior Biden-era hearing process has now been terminated. A new administrative hearing beginning June 29, 2026 will consider broader rescheduling of marijuana beyond the categories covered immediately by this order.
What is Schedule III?
Under the Controlled Substances Act, drugs are sorted into five schedules based on accepted medical use, abuse potential and safety profile. Schedule I is the most restrictive category, reserved for substances deemed to have no accepted medical use and a high potential for abuse. Until April 23, marijuana remained in Schedule I alongside heroin and LSD.
Schedule III substances are recognized as having accepted medical use and a moderate to low potential for physical dependence. Moving these covered marijuana products into Schedule III is the clearest formal acknowledgment yet by the federal government that marijuana has accepted medical use.
Schedule I vs. Schedule III: what actually changed
Schedule I: What marijuana was
No accepted medical use
High potential for abuse
Same category as heroin and LSD
Severe research restrictions
Business expenses not deductible under 280E
Schedule III: What covered marijuana products are now
Accepted medical use recognized
Moderate to low potential for dependence
Less restrictive controls
Fewer barriers to federal research
Covered state-licensed medical operators no longer subject to 280E
Does this legalize marijuana?
No. Marijuana remains a federally controlled substance. Rescheduling changes how certain marijuana products are regulated, not whether marijuana is federally prohibited overall. Federal criminal laws still apply. Interstate commerce remains illegal. Marijuana outside the categories covered by this order, including recreational marijuana, remains in Schedule I for now while the June 29 hearing process considers broader rescheduling.
As a practical matter, nothing about most state dispensaries changes overnight just because this order was signed. The significance is real. The day-to-day experience is more complicated.
What does this mean for medical marijuana?
This is where the most immediate change lands. The 40 states that operate medical marijuana programs now have a much stronger claim to federal recognition. State-licensed medical operators can begin the process of registering with the DEA under a new expedited pathway. Operators who apply within 60 days of the order’s publication can continue operating under their state licenses during the review period.
Researchers also gain meaningful new flexibility. Scientists who obtain marijuana from state-licensed sources for federally registered research will no longer face penalties solely for using state-licensed rather than federally registered bulk sources. That removes one of the biggest obstacles to clinical cannabis research in the United States.
What is 280E — and what does reclassification mean for cannabis businesses?
IRS code 280E has been one of the most punishing features of federal marijuana policy for legal operators. Because marijuana was treated as a Schedule I or II controlled substance, businesses engaged in “trafficking in controlled substances” were blocked from deducting ordinary business expenses like rent, payroll and utilities on their federal taxes. For many operators, that meant punishingly high effective tax rates.
The reclassification removes that restriction for covered state-licensed medical marijuana operators. The order also encourages the Secretary of the Treasury to consider providing retrospective relief from Section 280E liability for taxable years in which a state licensee operated under a state medical marijuana license. That relief is not guaranteed. The order itself makes clear that nothing in the rule is a final determination regarding federal tax liability, and operators should consult tax counsel about their specific circumstances.
To put the scale in concrete terms, Verano Holdings previously estimated that rescheduling would save the company roughly $80 million annually in 280E expenses alone.
What about dispensaries — does anything change today?
Not overnight for consumers. Your local dispensary looks and operates the same way it did yesterday. The 280E relief is real for covered medical operators, but the customer experience does not suddenly transform. Banking challenges remain. The SAFE Banking Act has not passed. Cannabis businesses still do not have access to mainstream financial services the way other legal industries do.
One area of genuine uncertainty remains: states where adult-use stores also serve registered medical patients. In Washington state, 302 of 460 licensed stores have endorsements allowing them to sell tax-free cannabis to registered patients. How the reclassification applies to those mixed-use operators remains unclear pending further federal guidance.
What happened to the Biden-era reclassification process?
The Biden administration initiated a formal rescheduling review in 2022. In August 2023, the Department of Health and Human Services concluded marijuana has accepted medical use and recommended Schedule III. The DOJ published a proposed rule in May 2024. DEA hearings were scheduled but repeatedly delayed, in part because of allegations that the agency had compromised the fairness of the process.
The Trump administration has now terminated that earlier process entirely. The June 29 hearing is a reset: new notice, new timeline, new process. Blanche used a separate legal authority tied to international treaty obligations to move the immediate rescheduling of covered marijuana products forward without waiting for the Biden-era rulemaking to conclude.
What comes next — and why is there still a hearing on June 29?
Today’s reclassification is official and immediate, but it only covers FDA-approved marijuana products and marijuana products regulated under qualifying state medical marijuana licenses. Recreational cannabis remains Schedule I. The June 29 hearing exists because the administration used a two-track approach: move the covered medical categories now, then conduct a formal hearing on the broader question of marijuana’s overall federal status. The hearing will consider whether marijuana outside the categories covered by this order should also move to Schedule III.
Legal challenges from opponents of marijuana reform are expected. More than 20 Republican senators signed a letter last year urging the administration to maintain current restrictions.
Even if broader rescheduling moves forward without legal interruption, full federal legalization or descheduling would still require a separate political and legislative fight. Rescheduling is a meaningful shift. It is not the end of prohibition.
Rescheduling is movement. It is not freedom.
High Times, December 2025
High Times has covered this moment since before it arrived. Our position has not changed: Schedule III is a meaningful step for the industry, particularly on taxes and research. It does not end federal prohibition. It does not free a single person still incarcerated for marijuana. It does not resolve the deeper structural inequities created by the war on drugs. The fight for full descheduling and legalization continues.
