Trump Signs Marijuana Reclassification Order: What It Means for You

President Donald Trump signed an executive order on December 18, 2025 directing federal agencies to reclassify marijuana from Schedule I to Schedule III, marking the most significant shift in U.S. cannabis policy in over half a century. This decision opens new doors for medical research, eases financial restrictions on dispensaries, and acknowledges what millions of cannabis users already know: marijuana has legitimate medical applications. If you’re wondering how this affects your cannabis experience, here’s everything you need to understand about the reclassification and its practical implications.

• Marijuana moves from Schedule I to Schedule III, placing it alongside Tylenol with codeine and ketamine rather than heroin and LSD
• This does not legalize marijuana for recreational use at the federal level—possession remains technically illegal under federal law
• Dispensaries will finally get tax relief through exemption from IRS Code Section 280E, allowing standard business deductions for the first time
• Medicare CBD pilot launches April 1, 2026, reimbursing seniors up to $500 annually for qualifying CBD products
• Banking access improves as institutional capital and financial services become available to state-licensed cannabis businesses
• 64% of Americans support legal marijuana, according to November 2025 Gallup polling, reflecting the bipartisan appetite for reform

For over fifty years, marijuana sat in Schedule I of the Controlled Substances Act—the DEA’s most restrictive category reserved for substances with “no currently accepted medical use and a high potential for abuse.” This classification grouped cannabis with heroin, LSD, and ecstasy, creating enormous barriers for researchers, businesses, and patients alike.

The executive order directs Attorney General Pam Bondi to expedite the rescheduling process and publish a final rule moving cannabis to Schedule III. According to the Drug Enforcement Administration, Schedule III substances have “moderate to low potential for physical and psychological dependence.”

The new classification puts marijuana in the company of:

• Tylenol with codeine
• Ketamine
• Testosterone
• Anabolic steroids

This reclassification fundamentally changes how the federal government views cannabis—from a dangerous substance with zero medical value to one with recognized therapeutic applications and manageable risks.

Trump was explicit about the boundaries of this action. “It doesn’t legalize marijuana in any way, shape or form, and in no way sanctions its use as a recreational drug,” he stated in the Oval Office before signing. The order focuses specifically on medical applications and research capabilities.

• For Medical Patients: The reclassification eases regulatory hurdles and allows the FDA to study medical applications for cannabis, potentially expanding its use among seniors, veterans, and others seeking pharmaceutical alternatives to opioid painkillers.
• For Dispensaries: State-licensed cannabis businesses gain exemption from IRS Code Section 280E, which previously barred them from taking standard tax deductions. This means dispensaries can finally deduct operating expenses like rent and payroll—a financial lifeline that could lower overall prices for retail products.
• For Researchers: Schedule I status created significant barriers to research. Scientists faced extensive paperwork, security requirements, and limited access to cannabis samples. Schedule III removes many of these obstacles, allowing research studies to incorporate real-world evidence and assess health outcomes more effectively.
• For Banking: The move opens the door for banking access and institutional capital previously sidelined by compliance fears. Cannabis companies may finally access traditional financial services without forcing banks into regulatory gray areas.

• Federal Possession Laws: Anyone possessing marijuana remains in violation of the Controlled Substances Act and still subject to arrest under federal law. The reclassification changes the severity of the classification, not the fundamental illegality.
• State-by-State Variance: Your local cannabis laws don’t change based on this order. States that have legalized recreational or medical marijuana continue operating under their existing frameworks. States maintaining prohibition will not suddenly see legal dispensaries.
• Recreational Use Policy: Trump specifically stated the order does not sanction recreational use. “It’s never safe to use powerful controlled substances in a recreational manner,” he said, indicating no appetite for broader legalization.

One of the most overlooked aspects of the executive order involves CBD access for seniors. The administration announced a pilot program through the Centers for Medicare and Medicaid Services that will reimburse seniors up to $500 annually for qualifying CBD products, beginning April 1, 2026.

This marks a significant shift in how federal health insurance treats cannabis-derived products. While CBD has surged in popularity in recent years—appearing in everything from seltzers to skin care—the FDA has not granted the compound full backing. The Medicare pilot represents the first pathway for federally insured coverage of cannabis-derived therapies.

The order also directs the White House Deputy Chief of Staff for Legislative, Political and Public Affairs to work with Congress on expanding Americans’ access to CBD products while maintaining restrictions on products posing serious health risks.

The 280E tax burden has inflated cannabis prices for years. Dispensaries paying effective tax rates far exceeding other businesses had no choice but to pass those costs to consumers. With standard deductions now available, expect lower overall prices at state-licensed retail locations.

NORML’s Deputy Director Paul Armentano noted that tax fairness “levels the playing field and lowers these entities’ costs of doing business,” creating incentives for consumers to “abandon the underground market.”

The federal government acknowledging legitimate medical applications delegitimizes decades of prohibition rhetoric. Claims that cannabis poses unique health harms or lacks medical utility have been rejected by the very federal agencies that formerly promoted them.

This shift may embolden more states to modernize their cannabis policies. Some lawmakers have cited federal Schedule I classification as their reason for opposing legalization or medical use—that excuse evaporates with rescheduling.

Better research ultimately benefits consumers through improved understanding of strain effects, optimal dosing, drug interactions, and long-term health outcomes. The executive order specifically emphasizes closing “the gap between current medical marijuana and CBD use and medical knowledge of risks and benefits.”

Trump’s marijuana pivot represents the culmination of sustained lobbying efforts and shifting public opinion. The cannabis industry mounted an extensive campaign targeting the administration throughout 2025.

The American Rights and Reform PAC aired pro-marijuana ads specifically targeting Trump’s televisions at the White House and Mar-a-Lago. Federal Election Commission records show the PAC donated $1 million in March to MAGA, Inc., a Trump-aligned super PAC. The group also hired a pollster with close ties to Trump and paid $300,000 to X Strategies, a consulting firm run by Trump adviser Alex Bruesewitz.

The Biden administration initiated the review process in 2022, with the Department of Health and Human Services recommending Schedule III status the following year. However, DEA administrative hearings stalled in early 2025, leaving the rule in limbo when Trump took office for his second term.

Trump acknowledged the pressure during the signing. “I’ve never been inundated by so many people as I have about this particular reclassification,” he said.

The executive order aligns with overwhelming public sentiment. According to November 2025 Gallup polling, 64% of U.S. adults believe marijuana use should be legal.

A Pew Research Center survey from early 2025 found even stronger support:

• 66% of Democrats and Democratic leaners support legalizing marijuana for both medical and recreational use
• 43% of Republicans and Republican leaners agree
• Only 11% of Americans say marijuana should not be legal at all

This bipartisan consensus has been building for years, finally reaching a tipping point that made federal action politically viable.

Not everyone celebrates the reclassification. Some Republican lawmakers urged Trump to oppose rescheduling, arguing in a letter that “reclassifying marijuana as a Schedule III drug will send the wrong message to America’s children, enable drug cartels, and make our roads more dangerous.”

Health experts have also raised concerns. FDA-funded research warns that prolonged CBD use can cause liver toxicity and interfere with other lifesaving medications. Studies have found “inconsistent benefits” for targeted conditions, suggesting more research is needed—ironically, research that Schedule III status now enables.

Douglas Berman, executive director of The Ohio State University’s Drug Enforcement and Policy Center, notes that rescheduling comes against the backdrop of other federal changes, including a recent spending bill that criminalized certain hemp products.

The executive order directs Attorney General Pam Bondi to “take all necessary steps to complete the rulemaking process“ and publish a final rule “in the most expeditious manner.” However, the order includes no specific timeline.

The formal rescheduling process has been ongoing for over a year, initially stalled by administrative hearings. Trump’s directive accelerates that process, but regulatory procedures take time. Expect implementation to unfold over months rather than days.

Cannabis attorney Shawn Hauser of Vicente LLP, which has worked with both the Biden and Trump administrations on cannabis reform, called the reclassification “the most significant shift in federal drug policy in over half a century.”

The reclassification potentially expands access to cannabis as a pharmaceutical option. Discuss with your healthcare provider how Schedule III status might affect your treatment options. If you’re using cannabis for chronic pain, seizure disorders, or other conditions Trump mentioned, medical marijuana may become more accessible through traditional healthcare channels.

Nothing changes immediately regarding federal possession laws. Continue following your state’s regulations. The practical day-to-day experience of buying from a licensed dispensary remains the same, though prices may gradually decrease as businesses benefit from tax relief.

Pay attention to banking developments. Financial institutions have been reluctant to serve cannabis businesses due to federal restrictions. Schedule III status may encourage more banks to enter the space, creating new investment opportunities and business models.

This executive order represents a pivot point in American drug policy. For the first time, the federal government formally acknowledges that cannabis has medical value—something cannabis consumers have understood for generations.

The reclassification won’t solve every problem facing the cannabis industry. Interstate commerce barriers remain. Workplace drug testing continues. Federal legalization requires Congressional action, not executive orders.

But the symbolic weight matters. Having a Republican administration back this reform, as NORML’s Political Director Morgan Fox noted, will likely embolden more Republican lawmakers who have privately endorsed marijuana policy reform to now do so publicly.

The conversation has permanently shifted. Whatever comes next in cannabis policy will build from this new baseline—one where the federal government no longer pretends marijuana belongs in the same category as heroin.