While marijuana remains illegal at the federal level per the 1970 Controlled Substances Act, the US has become a patchwork of state-determined laws pertaining to the drug. Some states have legalized recreational marijuana, others allow medicinal use and/or CBD oil. A few states have decriminalized the plant, and a handful follow the federal guidelines.
What does marijuana legalization mean?
In the the United States, marijuana legalization refers to the process of making marijuana use, possession, and sales legal under certain conditions. Adults in states that legalize the drug can use it for both medical and recreational purposes, following state laws.
Legalization allows for regulated sales of products that contain cannabidiol (CBD) and tetrahydrocannabinol (THC). Medical cannabis laws also fall under this category, permitting patients with conditions such as chronic pain, multiple sclerosis, insomnia, and depression to use the substances for treatment.
Since marijuana remains classified as an illegal drug at the federal level, state legalization has many implications on federal income taxes filed by dispensaries, as well as the cross-border sale and transportation of cannabis products.
Which states have legalized marijuana?
State cannabis legalization can be defined several ways, ranging from fully illegal to legal for both medicinal and recreational use. For this article, USAFacts defined five legalization levels to help explain how they vary by state.
Recreational
States that have legalized recreational marijuana have guaranteed adults 21 and older the right to use cannabis products for personal enjoyment rather than for strictly health benefits.
As of April 2024, 24 states and Washington, DC, have legalized recreational marijuana. Ohio was the last state to legalize recreational marijuana, when voters approved Issue 2 in the November 2023 election.
The legalization of marijuana use does not always mean it’s legal to purchase. In Washington, DC, it’s legal for anyone 21 and older to possess up to two ounces of marijuana, grow up to six marijuana plants in the district (with up to three in the mature flowering stage), and gift up to an ounce of marijuana to anyone 21 years or older — as long as no sales or trades occur. This is because it is illegal to buy marijuana in Washington, DC.
Medical
Legalizing medical marijuana means the state has established a medical framework that allows doctors to recommend marijuana for a wide range of conditions, including pain, nausea, depression, anxiety, and PTSD. States determine the medical conditions for which physicians can prescribe cannabis and cannabinoids.
As of August 2023, 37 states and Washington, DC, have fully legalized medical marijuana.
However, there’s a caveat to this category. Some states have only legalized medical marijuana with the CBD compound while retaining laws that prevent the distribution of high-THC medical cannabis.
CBD only
Seven states have limited medical marijuana to include only CBD products as of August 2023. Legalized medical marijuana primarily includes CBD compounds rather than THC compounds, though these products can still have low-THC levels. Unlike its cousin, delta-9-tetrahydrocannabinol (THC), CBD is not psychoactive. CBD products may include lotions, oils, sprays, gummies, and food products.
Seven states have limited medical marijuana to include only CBD products as of August 2023.
Fully illegal
As of August 2023, marijuana is still completely illegal in six states and people cannot obtain medical or recreational cannabis in any form.
These states have raised legislative measures to either begin medical or recreational legalization – for example, Idaho’s House Bill 370, Wyoming’s House Bill 143, or North Carolina’s Senate Bill 346, to name a few.
Decriminalized
Decriminalization eliminates jail or prison time for limited possession of marijuana, though other penalties may remain. Some states treat minor marijuana offenses like minor traffic infractions — violators are punished with fines of a few hundred dollars. Other states with decriminalization laws may still include possible jail time for possessing larger amounts of marijuana, or selling or trafficking the drug.
As of August 2023, 31 states and Washington, DC, have decriminalized marijuana (this includes states that have legalized recreational and medicinal use).
Of these, 23 states have both legalized and decriminalized marijuana, six have legalized medical cannabis and decriminalized possession up to a certain point, and the last two, Nebraska and North Carolina, have not legalized the drug at any level, but have decriminalized it.
Possessing larger quantities or selling cannabis may still carry significant penalties in states that have decriminalized marijuana.
What’s the difference between legalization and decriminalization?
While the two processes appear to overlap, legalizing and decriminalizing cannabis can have two distinct and important meanings.
Legalizing marijuana involves making it fully legal for specific purposes, such as recreational or medical use. When marijuana is legalized recreationally, adults can use cannabis products within certain regulations set by the state.
On the other hand, decriminalizing marijuana means reducing or eliminating the criminal penalties associated with possession or use. Decriminalization doesn’t fully legalize the drug but results in civil fines or citations instead of criminal charges.
For example, while marijuana is fully illegal in Nebraska, the drug has been decriminalized under their criminal code, punishing possession of up to one ounce with a $300 citation rather than criminal charges.
How do federal drug laws impact states?
Despite many states loosening marijuana laws, the federal government has yet to legalize the drug. Under the Controlled Substances Act (CSA), federal law continues to prohibit cannabis sale and use; marijuana remains classified as a Schedule I drug with a high potential for abuse and no accepted medical use. Therefore, even where marijuana has been legalized for recreational use, state laws conflict with federal laws.
Marijuana retail businesses, therefore, must remain in jurisdictions where marijuana is legal. The marijuana that a business sells must be grown, sold, used, and taxed within state lines — without using any federal land or means of commerce. This presents several complications, including preventing cannabis businesses from using banks (which are federally regulated), deducting business expenses on their federal income taxes (which other businesses are allowed to do), and preventing farmers from using water from federally managed resources.
Several recent proposals would remove marijuana from CSA control. For instance, the Marijuana Opportunity Reinvestment and Expungement Act would remove marijuana and THC from the CSA and require expungement of past convictions for many federal marijuana offenses.
Among other things, it would also remove some collateral consequences for marijuana-related activities, impose a 5% tax on cannabis products, and use revenues from the tax to fund grant programs for "certain persons adversely impacted by the War on Drugs.” The MORE Act passed the House in April 2022 and is currently pending before the Senate.
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