What to know about Trump’s order seeking to relax federal drug policies for marijuana

President Donald Trump displays an executive order reclassifying marijuana as a less dangerous drug in the Oval Office of the White House, Thursday, Dec. 18, 2025, in Washington. Photo by Evan Vucci /AP

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President Donald Trump has directed his administration to work as quickly as possible to reclassify marijuana as a less dangerous drug.

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Trump’s executive order on Thursday does not legalize marijuana under federal law. And it’s not the final word. The proposed change still requires federal regulatory approval.

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But the change could make the marijuana industry more profitable, facilitate new research on medicinal uses and nudge federal policy closer to a more tolerant approach already in place in many states.

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What’s the federal policy on marijuana?

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Possessing marijuana is a federal crime punishable by fines and prison time. Selling or cultivating marijuana is a more serious offense, punishable by prison sentences of five years to life, depending on the quantity of the drug. That would not change.

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Rather, Trump is proposing to reclassify marijuana from a Schedule I drug, alongside heroin and LSD, to a less dangerous Schedule III substance, which includes such things as ketamine and some anabolic steroids.

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The federal government defines a Schedule I drug as having no accepted medical use and a high potential for abuse. Schedule III drugs are defined as having moderate to low potential for physical and psychological dependence.

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The U.S. Justice Department had proposed to reclassify marijuana under President Joe Biden, eliciting nearly 43,000 formal public comments. The Drug Enforcement Administration was still in the review process when Trump succeeded Biden in January, triggering a re-examination of the policy.

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What did Trump say?

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Trump said he has long taken a just-say-no approach to drugs.

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“I’ve always told my children, ‘Don’t take drugs, no drinking, no smoking,”‘ Trump said at a White House event Thursday.

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But he added: “At the same time, the facts compel the federal government to recognize that marijuana can be legitimate in terms of medical applications when carefully administered.”

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Trump said he has been swamped with calls urging him to make marijuana more accessible for people struggling with health problems such as severe pain.

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“This reclassification order will make it far easier to conduct marijuana-related medical research, allowing us to study benefits, potential dangers and future treatments,” Trump said.

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His executive order directs the attorney general to “take all necessary steps” to complete the rule-making process to reclassify marijuana as a Schedule III drug “in the most expeditious manner” allowed under federal law.

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What would reclassification mean for cannabis shops?

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Federal income tax deductions for business expenses aren’t available to enterprises involved in “trafficking” any Schedule I or II drug.

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Changing marijuana to a Schedule III drug could save hundreds of millions of dollars in taxes for businesses licensed to sell marijuana in states where it is legal, said Rachel Gillette, a Denver attorney at Holland & Hart who leads the firm’s cannabis industry practice.