On December 18, 2025, President Donald Trump signed an Executive Order directing the federal government to expedite the process of moving marijuana under the federal Controlled Substances Act (CSA) from Schedule I to Schedule III.
That headline sounds like a major shift—and it is a meaningful development at the federal level—but it’s also easy to misunderstand. Here’s what North Carolina individuals, families, and business owners should know.
1) What the Executive Order actually does
The Executive Order directs the U.S. Attorney General to expedite completion of the federal rescheduling process and calls for expanded federal efforts around research and standards, including research methods using real-world evidence.
Important context: rescheduling marijuana still requires federal agency action through established administrative steps. Executive direction can accelerate priorities, but it does not automatically complete the legal change by itself.
2) What the Executive Order does not do
It does not “legalize” marijuana federally
Even if marijuana is ultimately moved to Schedule III, it remains a controlled substance under federal law. That is not the same as full federal legalization.
The President can’t directly change scheduling unilaterally
Changing a drug’s schedule under the CSA generally requires agency action through federal administrative process (including rulemaking). An Executive Order may influence the pace or priority, but final rescheduling depends on the agencies completing that process.
3) Why Schedule III matters federally (if/when it happens)
If federal agencies complete a move to Schedule III, some major downstream effects may include:
A) Research barriers could be lower
Schedule III status generally reflects an “accepted medical use” classification at the federal level, which can affect how research is approved and conducted compared to Schedule I.
B) Potential federal tax impact: 280E
One of the biggest practical changes discussed nationally involves Internal Revenue Code Section 280E, which limits business deductions for enterprises trafficking in Schedule I or Schedule II substances. If marijuana becomes Schedule III, 280E would no longer apply the same way to marijuana-related activity, which could significantly affect tax planning and financial modeling for cannabis businesses in states where cannabis is legal.
4) The most important point for North Carolina: state law does not automatically change
Even if federal rescheduling is finalized, North Carolina law remains separate and does not automatically change.
Marijuana is still a controlled substance in North Carolina
North Carolina currently classifies marijuana as a Schedule VI controlled substance under state law.
State penalties can still apply
North Carolina’s controlled substance laws continue to govern possession, distribution, and related conduct under state law.
In practical terms: federal rescheduling does not create a “free pass” in North Carolina.
5) Why this is still relevant in NC (even before any state-law change)
Even with North Carolina’s current framework, shifting federal policy can affect real-world planning—especially for business owners and families who operate across state lines or who are evaluating risk.
Here are a few areas where we’re seeing questions:
Business planning and contracts
Federal rescheduling discussions often raise questions about:
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Banking relationships and payment processing
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Vendor and partnership agreements
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Mergers and acquisitions due diligence (especially for companies with hemp/cannabinoid product lines)
Real estate transactions
Landlords, buyers, and lenders may ask:
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Whether a tenant’s operations could create regulatory or financing complications
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How contracts should address cannabinoid-related inventory, revenue, or compliance representations
Estate and succession planning
Where a family business touches cannabis/cannabinoids (even indirectly), it can be helpful to ensure your plan accounts for:
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Business continuity
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Valuation and transfer strategy
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Risk-aware structuring
6) What to do now
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Don’t assume “rescheduled” means “legal.” Even Schedule III keeps marijuana regulated federally.
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In North Carolina, treat marijuana as still prohibited under state law unless and until state law changes.
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If your business touches hemp/cannabinoids or operates across state lines, now is a good time to review contracts, compliance posture, and risk exposure.
How K.S. Walker Law Group can help
K.S. Walker Law Group helps individuals, families, and business owners across Charlotte and beyond navigate transactions with clear guidance and practical planning.
If you have questions about how shifting federal marijuana policy could affect business planning, contracts, or long-term strategy, our team is here to help.
This post is for general informational purposes only and does not constitute legal advice.