My Cannabis Accountant Founder Harry Shurek Talks Plants, Crypto, the Metaverse, and Paying Taxes in Disruptive Industries
“Disruptive industries are not for the weak-hearted,” says Harry Shurek. As founder of My Cannabis Accountant and The Crypto Accountant, Shurek knows well what it means to be a pioneer in disruptive spaces. He’s among the first accounting firms ever to do business in the cannabis and crypto sectors, and certainly the first to market himself as such. But his longevity with these sectors, and his commitment to innovation, have led to remarkable results, including the newly-launched metaWRK company that brings cannabis, crypto, accounting, web3, and everything Shurek loves into a platform that’s about to change the world.
Who Is My Cannabis Accountant Founder Harry Shurek?
Shurek’s insatiable curiosity and zest for life has carried him through a lifetime of multitudes. Beginning his career with years in banking, followed by an equally lengthy experience in retail sales, he got his Master’s in accounting and then worked for private clients and small practices before eventually opening his own firm in 2009. Between 2009 and 2015, Shurek Accounting and Tax grew to 800 clients, doing business with people and entities all over the country while also becoming recognized as a community cornerstone in its owner’s hometown of Buford, Georgia. In 2015 when legalization began spreading across the country, a client connected Shurek to colleagues in the cannabis industry that were looking for investors, and during this process he discovered the shortage of accountants serving the space. After spending a year meeting with multiple groups in different states with investment opportunities, Shurek asked one of the store owners about his own experiences, and ended up meeting and signing that client at his first MJBizCon, the largest international cannabis business event of the year, thrusting him irrevocably into the role of a plant-forward professional.
Since then, Shurek has curated his practice to focus on industrial revolutions. My Cannabis Accountant is one of the oldest cannabis accounting firms in the nation, having worked with over 100 licensees in 25 states. When crypto opportunities arose, the ever-perceptive entrepreneur built a coin-mining operation out of his basement involving 40 machines. Though competition and natural progression got Shurek’s manmade mine “bricked” after two years, he acquired enough knowledge and clients in the arena to open The Crypto Accountant as well.
metaWRK: Harry Shurek Brings Cannabis and Crypto Accounting to the Metaverse
metaWRK, which debuted in January, is a completely new venture that merges real life and the digital landscape. Combining all of Shurek’s passions and facilitating clients’ entry into web3, the heart of the business is concentrated in a four-story metaverse building. Each of the individual accounting practices has its own floor, where meetings and educational seminars can be conducted as well as other projects. The My Cannabis Accountant area even features a cannabis lounge. Meanwhile, the fourth floor serves as a rooftop event venue and networking meetup space.
“We’re the first cannabis accountant in the metaverse for sure,” Shurek declares. Having soft-launched metaWRK at MJBizCon in November 2022, as part of the storied Shangri-La afterparty event hosted by David Tran and James Zachodni’s Farechild, it seems the numbers guru sees the value in his latest brand embracing its cannabis sibling’s community. metaWRK offers a diverse suite of services ranging from custom web3 space design and buildouts, AR technology, phygital asset creation, graphic design and website buildout to branding and marketing, pitch deck development, creative services, and virtual lecture hall, event space and office rentals, which will surely appeal to progressive clients in the cannabis industry. It’s also helpful that metaWRK will have a real-life headquarters in New York, the cannabis consumption capital of the world.
“There’s a lot [of overlap between cannabis and crypto], because it’s the same,” Shurek observes. “It’s out of the box thinking. They are still two different networks, but there’s more and more unity forming… I’ve spoken with people in both industries about doing a cannabis and crypto show, which is what I think we’re going to see this year. Cannabis [events] have structured sponsorship levels, while a lot of crypto events are still crazy cash-grabs where the minimum sponsorship is $20,000, with little or no real value being given to the attendees. But I think you’ll see a combo in the conferences.” He adds that the rise of NFTs and blockchain technology in the cannabis sector will increasingly be used to verify the authenticity of new strains that get released.
Harry Shurek on the Failure of SAFE Banking and the Future of Cannabis Business Operations
Of course, many players in the cannabis industry are still concerned about the most basic conundrum – U.S. Code § 280E, the law stating that businesses engaged in trade of Schedule I controlled substances cannot deduct normal business expenses. This means that regardless of a company’s legality in its home state, a cannabis company cannot write off typical deductions like office rent, advertising, professional fees, or travel on its taxes. Congress has confronted the topic several times over the past few years with the SAFE Banking Act, a bipartisan reform measure that seeks to provide a secure pathway for federal banking institutions to work with legal cannabis businesses and would possibly repeal 280E for these entities with its passage. However, the SAFE Banking Act failed to pass in the Senate this December, the third time it’s done so since its introduction in 2019. The bill can be reintroduced this session, but with a Republican-controlled House of Representatives, it may not get the necessary votes to proceed a fourth time.
In Shurek’s professional opinion, SAFE Banking will never be a reality in his lifetime. “I know for a fact that between 2017 and 2019, banks were given permission to work with cannabis companies,” he explains. “It wasn’t some big secret, but they didn’t do it because their money was with other companies [and] Big Tobacco. Big Tobacco owns this country. [Also, it] takes a bank around eleven-and-a-half years to get chartered. You think of that process and now you’re going to risk it for a cannabis company? If that company’s out of compliance, you lose it all. There’s nothing preventing Chase, Wells Fargo, Bank of America, any of them, from getting involved with cannabis as some credit unions are doing. They all fall to the same laws from the Federal Reserve. They just don’t want to, because there’s a lot of money in play against this industry.”
“It’s so hard to win in this industry,” he continues. “I’m not saying you can’t make money here, but it’s harder than most people think. There are so many barriers that make being successful in this industry very challenging compared with any other, including the ‘phantom income’ created by the disallowed deductions from 280E, the lack of banking options that end up costing some cannabis companies in excess of $2,000 per month just to have basic banking services and paying 3X market rent because you operate a legal plant-touching company. All of these factors PLUS a declining price of flower across the nation and increasing competition from MSOs makes this a very challenging space to navigate.”
Competition between legal cannabis retailers and the illicit market continues to be fierce in every state that has regulated, with New York no exception. According to Shurek, the current oversupply of licensed cannabis that was grown in 2022 with nowhere to sell, in addition to the other chaos that’s delayed the state opening its licensed adult-use dispensaries, will continue to have a severely detrimental effect on the regulated market. Many legacy operators are wary of the Office of Cannabis Management’s (OCM) approach to the industry, and unlicensed “grey market” smoke shops abound. Allegedly, some grey market owners may have even located a loophole by charging sales tax on their products, which the IRS could view as compliance.
Why Does Cannabis Accounting Matter?
No matter where people are in their business, Shurek urges everyone to remember the universal lesson of Al Capone. The legendary gangster was eventually convicted and imprisoned not for his violent activities or for bootlegging during prohibition, but for tax evasion, and he died while incarcerated. It’s critically important to pay your taxes.
“A lot of the time, accountants are the last ones you think of, when really we need to be the first ones that people talk to,” he comments. “Because how your company is set up, especially in cannabis, has such a huge effect on the kind of taxes you pay at the end of the year. And we don’t just do taxes, we offer complete business consulting services. We help people understand that the way they form their company has ramifications on how they’re going to do business in the future. Your tax returns not only go to the IRS, they go to banks and investors. They go to people who want to see how your business is doing. There are many different places that look at your financials.”
For example, he states, many of his cannabis clients are registered as C corporations instead of S corporations, because then their owners can avoid having to file K-1 forms that would otherwise go through their personal tax returns. Shurek says that separating cannabis income from one’s personal taxes has a huge impact, because banks will still qualify cannabis income as drug dealing and personal tax returns can affect someone’s application for a mortgage, a car, or financial aid toward a school program.
Surviving in Cannabis, Crypto, and Other Disruptive Industries: What's Next for Harry Shurek?
“No other industry works like this,” Shurek concludes. But the challenge of having to think out of the box for his cannabis clients – and now his crypto clients – has given him a renewed excitement for his profession. He reflects that while he does work with cannabis companies to find creative solutions to the roadblocks posed by 280E, the true reward of being an accountant in the space is understanding how necessary ancillary services are to the survival of the entire industry.
“[Everyone thinks they] want to be in retail, but retail is the hardest, riskiest, most expensive part of the model, so proper strategy and planning are crucial,” the wise magician affirms. “When I first started My Cannabis Accountant, I told everybody, ‘My goal for your company is to have you be seen like any other company.’ Our model worked because we didn’t do anything differently than we were before, besides learning how to apply our accounting and tax knowledge to the cannabis space. We learned ways to minimize the effects of 280E, but we did what we were doing before while everyone else was trying to reinvent the wheel. You can adjust to the cannabis industry by doing whatever you’re already doing successfully, and just bring it here.”
And so it goes that Harry Shurek retains the bit of Clark Kent beneath his Superman. Laughingly referring to his persona at cannabis and crypto conferences as “a costume,” he admits that he’s pleased to be “a quiet hippie accountant” working on so many cutting-edge projects by doing what he knows how to do best. With the dawn of metaWRK, that mix of business acumen, creative spark, and mathematical clairvoyance seems poised to fly us into a new age. It’s a bird, it’s a plane, it's an accountant – just make sure he saves you before tax season is over.
For more about Harry Shurek, My Cannabis Accountant, The Crypto Accountant and metaWRK, visit mycannabisaccountant.com, thecryptoaccountant.io and metawrk.io.
Find Out More On Social
My Cannabis Accountant / MCA Accounting Solutions
--
Featured image: Harry Shurek, founder of My Cannabis Accountant, The Crypto Accountant, and metaWRK (C) My Cannabis Accountant / MCA Accounting Solutions