Trump Administration Reclassifies Medical Marijuana to Schedule III

Historic Federal Policy Shift

Acting Attorney General Todd Blanche signed an order Thursday reclassifying state-licensed medical marijuana as a less dangerous drug, moving it from Schedule I to Schedule III of the Controlled Substances Act . This places licensed medical marijuana in the same category as prescription medicines like ketamine and Tylenol with codeine , marking a dramatic departure from decades of federal prohibition.

The action follows President Trump's December 18, 2025, Executive Order on Increasing Medical Marijuana and Cannabidiol Research , which directed agencies to expedite the rescheduling process that had stalled under the previous administration. Blanche used specific legal authority to bypass the stalled DEA rulemaking process that had dragged on since the Biden administration, terminating that prior process entirely .

The order does not make recreational use legal under federal law , but creates what experts describe as an unusual split where the same plant exists under two different federal classifications. Recreational cannabis remains Schedule I, while the administration used a two-track approach to move covered medical categories now, then conduct a formal hearing on the broader question .

Immediate Industry Impact

State-licensed operators in 40 states plus the District of Columbia will now be able to deduct ordinary business expenses on federal tax returns — a benefit previously blocked under Schedule I rules . This change addresses one of the most significant financial burdens facing legitimate medical marijuana businesses, which have been forced to operate under punitive tax restrictions.

The reclassification also gives a tax break to licensed medical marijuana dealers and eases some restrictions on researching its effects, potentially improving banking and financial services access for legitimate medical programs . Scientists have faced strict approval processes, limited supply access and heavy compliance requirements when attempting to examine cannabis for therapeutic use, even as roughly half of states have legalized marijuana for recreational use .

However, the split classification creates new complexities. "They've bifurcated one plant into two different schedules, which is very odd to me," said Colorado-based attorney Rachel Gillette, who acknowledged the order opens up more questions than answers and could cause confusion if broader rescheduling doesn't occur .

Research and Medical Applications

Acting Attorney General Blanche stated that "this rescheduling action allows for research on the safety and efficacy of this substance, ultimately providing patients with better care and doctors with more reliable information" . The change specifically addresses the longstanding research barriers that have limited scientific understanding of marijuana's medical potential.

Thursday's order applies to marijuana, marijuana extracts and marijuana-derived compounds, like delta-9 THC, that are "included in an FDA-approved drug product or are subject to a state-issued license to manufacture, distribute, and/or dispense marijuana or products containing marijuana for medical purposes" . This precise language ensures the benefits extend to the full spectrum of state-regulated medical programs.

The timing aligns with broader Trump administration initiatives on alternative treatments. The move comes just days after President Donald Trump signed an executive order on psychedelics to accelerate research, clinical trials and "Right to Try" access for drugs like psilocybin, MDMA and ibogaine .

What Comes Next

A new administrative hearing beginning June 29, 2026, will provide a timely and legally compliant pathway to evaluate broader changes to marijuana's status under federal law . The hearing will consider whether marijuana outside the categories covered by this order should also move to Schedule III .

While advocates celebrate this as "a historic move towards sanity in cannabis policy," many note that a move to Schedule III "stops short of the systemic change we need" and "does nothing to end hundreds of thousands of possession arrests each year" . The reclassification represents significant progress for medical access and research while leaving the broader federal-state conflict over recreational use unresolved.

The June hearing will determine whether this partial rescheduling becomes a stepping stone toward comprehensive reform or remains a targeted solution for medical applications. Either way, the Trump administration has fundamentally altered the federal landscape around cannabis policy in ways that will reshape research, business operations, and patient access for years to come.