Utah Medical Cannabis / Marijuana Bonds

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Who Is Required To Purchase a Utah Marijuana Surety Bond?

Utah Marijuana License Bond Requirements

Utah issues the following licenses that require a surety bond or a liquid cash bond.

• Cultivators
• Processors
• Laboratory testers
• Cannabinoid product retailers

The difference between a surety bond and a cash surety bond is:

• A surety bond can be purchased for a fraction of the bond amount
• A cash surety bond requires a full deposit of the bond amount in special bank account

Most licensees choose a surety bond because it has a far less capital outlay upfront, but depending on your business the cash surety bond may be the right decision.

Here are the bond amounts for each license:

Cannabinoid Tax Bond Requirement

If you're a cannabinoid product retailer you have another bond requirement called a cannabinoid tax bond.

As a retailer, you're required to collect 10% of the retail price of cannabis products. Based on your tax liability, you will be told a bond amount to satisfy.

The minimum is $500 if you have no history of retail sales yet.

Just like the license bond holds you accountable to your customers and to the rules of your license, this tax bond holds you accountable to paying the correct amount of sales tax back to the Utah State Tax Commission.

Why is a Utah Cannabis Bond Required?

Getting licensed as a marijuana establishment in Utah is a difficult process and the Department is very thorough about the following requirements:

• Set up with the appropriate business structure
• Investigation into ownership history
• Adequate financial status
• Complete business planning
• Among many other regulations depending on the specific license

Plus many of the licenses are restricted to only a certain number.

The surety bond requirement is the primary tool used to ensure you:

• Stay in compliance with the current and changing laws
• Ensure your providing the service you're licensed to provide without tampering in the services or the physical cannabis products
• Pay the required sales tax for product sold

Again, the surety bond is the best method the Utah Department of Health and Human Services has to hold the business they license accountable to their business actions.

How Much Does a Utah Marijuana Surety Bond Cost?

Similar to insurance, the price of a surety bond is determined by a rate quoted from a surety.

A surety is a special type of insurance company that chooses to underwrite marijuana or cannabis surety bonds.

Every surety is different in how they assess the risk of a business and they will use their own analysis, primarily based on these factors.

• Personal credit of the owner or owners
• Business industry and experience
• Potentially business and owner financials in some cases
• Prior bond claims (if any) if owners have been licensed in the past or in other states

From this analysis, the surety will quote a rate and this rate multiplied by your bond amount is the price you'll pay.

How You Can Save Even More Money Purchasing Your Marijuana Surety Bond

Surety Bonds Direct is a specialized surety agency and we work with multiple A rated sureties to help our customers find the lowest possible price.

We've helped hundreds of marijuana businesses across the United States obtain their surety bond, and have seen the rates differentiate by one to two percentage points.

Depending on your license, this can save you hundreds, even thousands of dollars.

Example Marijuana Surety Bond Pricing

Let's use the $50,000 cannabis processor bond amount for the example. The rates in the table below range from really good to about average.

Pay attention to how a full percentage point to two can make a big difference to the price you have to pay.

Get your exact pricing today so you have a real number you can plan with. It costs you nothing to get your pricing and there's no obligation to purchase after you receive pricing.

Click here to request your pricing. Make sure you tell us which license or tax bond you require.

You can also call and speak to a bond specialist by calling 1-800-608-9950.

How Long Does The Utah Marijuana Surety Bond Last?

The Utah marijuana bond has a bond term of 12 months from the effective date.

The effective date is the bond's activation date. You choose this activation or effective date when you complete your bond purchase.

In Utah the surety bond is required for however long you remain licensed and operational as a business.

Renewing Your Surety Bond

This is another reason why it's advantageous to work with a surety agency like Surety Bonds Direct to purchase your surety bond.

You get assigned a bond specialist for your account. It's their job to manage your bond. They will contact you 30 to 45 days in advance to make sure the renewal premium is paid on time so your bond remains active.

Once you pay the renewal premium, you don't have to do anything else. Your bond is active and you can continue business.

Cannabis Bonds And Getting Your Utah Business License/Registration

Currently Utah is not licensing cultivators.

Click here to learn more about the licensing requirements for a processor.

Click here to learn more about the licensing process for a laboratory testing facility.

Click here to learn more about licensing for a cannabinoid product retailer.

If you're ready to get your bond, request your free quote. Again, you have nothing to lose to have official pricing delivered to your inbox. All price quotes are good for 30 days.

State Law Links Medical Cannabis Amendments https://le.utah.gov/~2024/bills/static/SB0233.html

Cannabinoid Title 59 - Chapter 31 - Part 2 - Section 202 Boding Requirement https://le.utah.gov/xcode/Title59/Chapter31/59-31-S202.html?v=C59-31-S202_2025010120240501

Utah Production Establishment License - Title 4 - Chapter 41a - Part 2 - Section 201 https://le.utah.gov/xcode/Title4/Chapter41A/4-41a-S201.html