Trump administration reclassifies state-licensed medical marijuana, launches broader review
The U.S. Justice Department has moved state-licensed medical marijuana from Schedule I to Schedule III, a shift that eases research restrictions and opens major federal tax deductions for compliant operators, while the administration sets a late-June hearing that could broaden rescheduling to recreational markets.
Trump administration reclassifies state-licensed medical marijuana, launches broader review
The U.S. Justice Department has reclassified state-licensed medical marijuana as a less dangerous controlled substance, a significant change in federal drug policy that could reshape parts of the cannabis industry while leaving broader legalization questions unresolved.
According to reporting by The Associated Press, an order signed Thursday by Acting Attorney General Todd Blanche moves state-licensed medical marijuana from Schedule I—reserved for drugs deemed to have no accepted medical use and a high potential for abuse—to Schedule III, a category that carries less stringent regulatory controls.
The order does not legalize marijuana for medical or recreational use under federal law. Possession, cultivation and sale remain federal crimes; the change primarily affects how certain state-regulated medical programs are treated for federal scheduling and related regulatory purposes.
What changes immediately
AP reported the order is intended to:
- Legitimize state medical programs for regulatory purposes by creating an expedited system for state-licensed medical marijuana producers and distributors to register with the U.S. Drug Enforcement Administration.
- Ease research constraints by clarifying that cannabis researchers will not be penalized for obtaining state-licensed marijuana or marijuana-derived products for use in research.
- Provide major tax relief to compliant medical operators by allowing, for the first time, certain state-licensed medical marijuana businesses to deduct ordinary business expenses on federal taxes—deductions that are generally barred for enterprises deemed to be “trafficking” in Schedule I or II substances.
The AP noted that marijuana-derived medicines approved by the Food and Drug Administration are also generally treated as Schedule III substances.
A second track: broader rescheduling remains unresolved
The Trump administration also said it was jump-starting the broader rescheduling process, setting a hearing to begin in late June that could address marijuana more generally, including implications for state-licensed recreational markets.
A separate AP analysis described the shift as a long-sought policy change for an industry that has expanded rapidly at the state level. Two dozen states plus Washington, D.C., have authorized adult recreational use, and 40 states have medical systems; only Idaho and Kansas ban marijuana outright, according to AP’s reporting.
But the administration’s move is also expected to face legal scrutiny. The AP reported that the order relies on a provision of federal law allowing the attorney general to determine drug scheduling when the U.S. must regulate a substance pursuant to an international treaty.
Support and criticism
Industry advocates described the decision as a landmark federal step. AP quoted Michael Bronstein, president of the American Trade Association for Cannabis and Hemp, calling it “the most significant federal advancement in cannabis policy in over 50 years.”
Opponents argued the order sends the wrong signal and accelerates commercialization. AP cited Kevin Sabet, CEO of Smart Approaches to Marijuana, who criticized the action as “a tax break to Big Weed” and warned it could increase use and related harms.
Health experts interviewed by AP also raised concerns that reclassification could reinforce perceptions that cannabis is low-risk, even as cannabis potency and cannabis use disorder remain active research and public-health issues.
What to watch next
- Details on DEA registration and compliance for state-licensed medical producers and distributors under the new framework.
- The late-June administrative hearing and whether it advances broader rescheduling for marijuana beyond medical programs.
- Legal challenges to the order’s authority and its interaction with federal enforcement statutes.
Sources
- Associated Press — “Trump reclassifies state-licensed medical marijuana in historic shift” (Apr. 24, 2026) https://apnews.com/article/medical-marijuana-rescheduling-justice-department-trump-cannabis-1d6722d3aae122b1a91f8e4b6c690268
- Associated Press — “Medical marijuana has been reclassified. Is recreational pot next?” (Apr. 24, 2026) https://apnews.com/article/marijuana-schedule-cannabis-trump-4a3ba752923ca1de103b3cd0ee3eb28a
- Associated Press — “What to know about Trump’s executive order on marijuana” (Apr. 24, 2026) https://apnews.com/article/trump-reclassify-marijuana-cannibas-legal-marijuana-federal-ab2aec5865dd140bac00b7cef5de89c5