On April 22, 2026, the Acting Attorney General signed AG Order No. 6754-2026, which moved marijuana subject to a state medical marijuana license, and FDA approved drug products containing marijuana, from Schedule I to Schedule III of the Controlled Substances Act. The order was published in the Federal Register and took effect on April 28, 2026, at 91 FR 22714. It is the most significant change to the federal status of marijuana since the Controlled Substances Act was enacted in 1970, and it remains in effect.
This update summarizes what the order did, the registration framework it created, and where the related proceedings stand.
What moved to Schedule III
The order places two categories in Schedule III. The first is marijuana contained in an FDA approved drug product. The second is marijuana, including certain marijuana extracts and naturally derived delta-9-tetrahydrocannabinols, that is subject to a qualifying state medical marijuana license. Treasury's summary of the order describes unlicensed marijuana crops and bulk marijuana as remaining in Schedule I. Adult use marijuana also remains in Schedule I.
The order was issued under the scheduling authority in 21 U.S.C. 811(d)(1), which allows the Attorney General to schedule a substance as needed to meet United States obligations under international drug control treaties. That authority is the reason the order moved without the formal rulemaking hearing that the broader proposal is still going through. It also added the covered products to the list of substances that may be imported or exported only under a DEA permit.
The registration framework in 21 CFR 1301.13(k)
The order amended 21 CFR 1301.13 to add paragraph (k), which governs DEA registration of state licensed medical operators. The Administrator registers an applicant holding a state medical marijuana license unless registration would be inconsistent with the public interest under 21 U.S.C. 823 or with the Single Convention on Narcotic Drugs. Registration of an applicant operating under a state regime with robust protections against diversion, recordkeeping and reporting requirements, and safety and inspection measures will generally be consistent with the public interest.
Paragraph (k)(1) establishes manufacturer, distributor, and dispenser registrations, allows one entity to hold more than one, and limits all of them to medical purposes. Paragraph (k)(2) makes the state license conclusive evidence of state authorization. Paragraph (k)(3) limits the registration to the scope of the state license and suspends it automatically if the state license is suspended, revoked, or expires.
The remaining paragraphs lean on state infrastructure. DEA accepts state required reports, records, and forms to the maximum extent permissible under (k)(4). A state medical certification that meets specific content requirements substitutes for a prescription under (k)(5). State labeling, packaging, disposal, and physical security requirements satisfy the corresponding federal rules under (k)(8), (k)(9), and (k)(10). Paragraph (k)(6) establishes a crop purchase and storage framework for manufacturers to satisfy Article 23 of the Single Convention. Paragraph (k)(7) gave applicants who filed within 60 days of publication a six month processing goal and interim operating authority. That period has ended, as we discuss in our update on the registration pathway.
Employee screening, owner eligibility, and the other security controls in 21 CFR Part 1301 do not appear on the list of areas deferred to the states. Registrants remain subject to them, as our article on employee screening describes.
Tax consequences
The order states that state licensees will no longer be subject to the deduction disallowance in Section 280E of the Internal Revenue Code, which applies only to trafficking in Schedule I or II substances. It also encourages the Secretary of the Treasury to consider retrospective relief for prior tax years in which a licensee operated under a state medical license. Treasury and the IRS announced on April 23 that guidance is forthcoming. That guidance has not yet been published, and we cover the announcement and its status in a separate update.
The companion hearing on broader rescheduling
Alongside the order, DEA noticed an administrative hearing on the 2024 proposal to move marijuana as a whole, including adult use, from Schedule I to Schedule III through formal rulemaking. The hearing ran from June 29 through July 15, 2026. Post hearing briefs have been filed, and the administrative law judge ordered corrections to the hearing transcript before releasing it. As of mid-September, the judge had not issued a recommended decision. After the recommendation, the DEA Administrator issues a final rule, and no statutory deadline governs that timing.
The outcome of that proceeding determines the federal status of adult use marijuana. It does not affect the Schedule III status of marijuana subject to a state medical license, which is already in force under the April order.
The D.C. Circuit challenge
Parties opposed to rescheduling petitioned the U.S. Court of Appeals for the District of Columbia Circuit for review of the order and asked the court to stay it while the case proceeds. On September 9, 2026, the court denied the motion to stay, leaving the order in effect. The merits of the petitions remain pending.
What this means for operators
For a state licensed medical operator, the federal position today is settled on the points that matter most to daily operations. The product covered by the state medical license is a Schedule III substance. Registration with DEA is required under 21 U.S.C. 822 to manufacture, distribute, or dispense it, and the registration is limited to the scope of the state license. Operators holding adult use licenses as well should keep medical and adult use inventory, records, and activity separate, because the adult use line remains in Schedule I.