HOA Taxes | What Tax Forms Are HOAs Required to File?

In the United States, there are more than 351,000 Homeowners Associations (HOAs). They represent about 40 million households, or 53% of the owner-occupied homes in the country. Said differently, if you own your own home, there’s a good chance that

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Wiped-out properties are due to be taxed as if still standing (TX)

As a result of Hurricane Harvey, Rockport’s mayor released a statement that approximately 30 percent of the community’s housing was destroyed, 30 percent to 40 percent was so badly damaged it was not salvageable, and only 30 percent to 40

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A Cautionary Tax Tale for Homeowner Associations

Imagine, if you will, that you are a board member of a homeowner association, where all common elements are owned by the association. One day your board discovers that all of the association’s common elements, including all of your privately

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Failing to Pay Taxes on Common Areas Can Have Dire Consequences (AZ)

A recent article in the Washington Post chronicled the plight of an upscale San Francisco community, which failed to pay its common area property taxes, and the savvy investors who took advantage.  We are aware of Arizona communities who have

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Tax Reform and Community Associations

U.S. Congress has been talking about Tax Reform for several years and President Trump has now turned his focus to Tax Reform by asking Congress to deliver a plan. This week, CAI submitted comments to the Senate Finance Committee to

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New Jersey Superior Court Holds Condominium Association Was Not Entitled to Redeem Tax Sale Certificate on Condominium

The Superior Court of New Jersey, Hudson County, Chancery Division-General Equity Part recently held that a condominium association’s attempt to redeem a tax sale certificate on a condominium on which it held a lien was not valid because it was

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Paris Meadows, LLC v City of Kentwood: Objecting to the Taxation of Common Elements (MI)

In Michigan the question of whether the common elements of a condominium are taxable appears to be well-settled. In Paris Meadows, LLC v City of Kentwood, 287 Mich App 136; 783 NW2d 133 (2010), the Michigan Court of Appeals held

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Taxes and Your HOA Community – To File or Not

If you live in a planned community, there is a good chance questions have come up about taxes and if your community needs to file them. We’ve heard many people admit that they didn’t realize their community needed to file

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IRS Revenue Ruling 70-604 and MCL 450.2541(2)(b): The Value of Expert Advice

Many individuals and corporations, including community associations, are currently preparing their tax returns. For associations with excess revenue this process most likely involves a determination of whether to exercise an election under IRS Revenue Ruling 70-604. A proper election under

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What to Do When It’s Tax Time for Your Association

It’s that time of year again. Tax time. And your Not-For-Profit Organization is no exception. Not-For-Profit organizations are considered a business and therefore obligated to file taxes like any other corporation. You can contact a Certified Public Accountant (CPA) or

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Can HOA Fees Be Claimed on Your Taxes?

Tax season is here and we all want to deduct every last penny we can find. If you’re a member of a homeowners association, have you ever considered whether or not the HOA fees you pay are tax deductible? Every

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It’s Tax Time for Your Association

As evidenced by the increase in advertisements from H&R Block, Turbo Tax and your friendly, local accountant, it’s clear that we have entered “refund season” – AKA time to file your personal taxes.   But, don’t forget that it’s also

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New Sales Tax Legislation Affects Property Owners Associations

A recent North Carolina Sales Tax law has a direct impact on the budget of just about every property owners association.On July 1, the state legislature passed House Bill 1030 – Current Operations and Capital Improvements Appropriations Act of 2016,

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Community Associations Countdown to Year-End!

The end of the year is approaching and before long we will be setting New Year’s resolutions for 2017. But before that new beginning, we need to wrap up 2016. For those associations whose year-end is December 31st there are

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Beach condo owners prepare tax lawsuits (FL)

“The real question is why are condominium associations being treated differently than other taxpayers on the beach,”

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‘Double-Taxed’ N.J. Condo Owners Pay 2 Different Towns

The condo is located in Maplewood but has access via South Orange. Should its owners have to pay taxes to both towns?

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Reductions in Property Value Due to the Presence of Construction Defects

Oregon Supreme Court recognized and seemingly affirmed a strategy to reduce taxable property value due to the existence of construction defects

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Your Homeowners’ Association May Not Be Taking Advantage of a Favorable Tax Break (FL)

The good news for such associations, however, is that they are entitled to an exemption for the sales tax related to their utilities as long as a few requirements are met

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MI Court of Appeals Rules That (County) Treasurer Cannot Foreclose on Common Elements

Michigan Court of Appeals held that the Wayne County Treasurer could not foreclose on common elements that were identified as “garage spaces” in the master deed

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Significant win in Supreme Court of Virginia for local association with statewide benefit

Supreme Court ruled on a case decided by a Suffolk Circuit Court Judge regarding the taxation of open space in a homeowners association.

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Tax relief for condo owners passes in Albany (NY)

J-51 is. a tax exemption for the cost of modifications or repairs to a building.

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TAX WATCH: Trump Tower (condo) garage deal skirts law (NY)

State law prohibits municipalities from separately taxing the common area of a condominium, which avoids double taxation on property owned by condo dwellers

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What You Should Know About the “Home Act”

It is designed to amend the Internal Revenue Code of 1986 to allow for a deduction for HOA assessments.

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Court of Appeals sides with Landmark HOA (CO)

Unless an appeal is successful, all homeowners would be repaid taxes amounting to around $5,000 per year.

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Chicago-area condo associations see wisdom in HOME Act

Here’s another reason to stay current on assessment payments to your community association: You might get a tax break

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Bill would grant tax deduction for homeowners association assessments

Under a new bill known as the HOME Act (H.R. 4696), millions of people who live in communities run by associations would get the right to deduct up to $5,000 a year of assessments on federal tax filings

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Taxes in Your Michigan Condominium or Homeowners’ Association: Is Your Association Current with the IRS?

For the inexperienced, filing federal taxes on behalf of a Michigan condominium or homeowners’ association may be an intimidating or overwhelming experience best left to the professionals

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Error costs Butler County (OH) condo owners thousands

There are 16 condo units located in the subdivision on Hamilton’s west side. There were supposed to be a total of 32 units, but the second phase of the project was never built

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Tax Tips For Associations

The vast majority of condominium and community associations are nonprofit corporations, but even they have to file taxes

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When do community associations need to vote to roll over surplus funds to the next fiscal year?

If an association is filing an 1120 tax return, the Association will be taxed on the excess funds in its operating account

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Do HOAs Have To File Tax Returns?

HOAs must file tax returns, including a state return in some states, but that does not necessarily mean an HOA may owe taxes

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Florida Homeowner Associations and Federal Income Tax Considerations

HOAs have two options for purposes of federal income taxation

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HOAs Must File Annual Tax Returns!

The bottom line is that community associations need to file federal and state (at least in Georgia) tax returns, and most are due on March 15 each year

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Tax Dates to Add to Your Calendar

There’s no avoiding taxes, but knowing the various tax deadlines for your HOA can at least make the process a little easier because it prevents you from scrambling at the last minute. If you want to get ready for tax

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Important Tax Deadlines Your HOA Board Should Put on the Calendar

Your homeowners association has tax reporting and filing requirements it must adhere to. It can be difficult for an HOA board to understand what these are all on its own. It’s important that your HOA board contacts your Association’s accounting

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AK: $42,500 settlement OK’d by council in condominium case

In the long-running Ken Castner v. City of Homer case, the Homer City Council on Monday approved a $42,500 settlement with Castner and his attorney. The council met in executive session to consider a settlement offer from Castner’s attorney, Stephan

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For seniors, tax-free condo association fees unlikely (AK)

It is unlikely that the city will try to find a way to make condo association fees tax exempt for seniors, even though these fees often include utilities that would otherwise be considered tax free by the city, according to

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Berkeley HOA (WV) common areas are no longer taxed

Residents who live in a homeowners association in Berkeley County may notice an adjustment in their annual tax bill after the Berkeley County Assessor’s Office has stopped taxing most HOA common areas.  Beginning with the 2015 tax bill, HOAs are

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Westgate (RI) condo owners face taxes on units that aren’t there

James Simmons and his wife, Susan Gaipo, own a Westgate condominium, only, like 37 other units, it hasn’t been there since being destroyed by fire on March 11. The Simmonses pay a monthly $271.89 association fee for water, heat and

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How mandatory accounting methods impact South Florida condo developers

The South Florida condo market has experienced a boom in recent years, due in large part by the influx of foreign investors, many of whom are paying cash for their condos. While cash up front is ideal and developers can

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Foreclosure Crisis Fallout: HOA’s Owe Cities Money (FL)

The Crossings in Boynton Beach is home to hundreds of people and like so many other places, the housing crisis hit hard.  City officials say in 2010, the development had many homes in foreclosure and those homeowners stopped paying their

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HOA income-tax returns can be filed two ways

Q: My husband is on the board of our HOA, and for the past two years our manager has said we have to file tax returns for the HOA. Our only income is from the assessments, plus a few dollars

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Condominium and Homeowner Federal Tax Returns again Due

Tax season is here once again! As nonprofit corporations, every community association in Ohio is required to file an annual tax return with the Internal Revenue Service. However, associations have the ability to choose between the filing of two different

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City to comply with judge’s ruling, says decision doesn’t apply to all (AK)

On the day Kenai Superior Court Judge Charles Huguelet imposed a deadline for the city to respond to an order to show why it’s not in contempt of court regarding its assessment of condominiums in the Kachemak Bay Title Company

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Indiana Tax Court rejects property tax exemption for Homeowners’ Association that failed to show it was organized to retain and preserve lake property

A Hoosier Homeowners’ Association was denied a property tax exemption because it failed to show that it was established for the purpose of retaining and preserving its land and water for their natural characteristics.      Read more……….

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Yes, Community Associations and HOAs Need to File Tax Returns!

This is one of the first questions I ask when I meet with a new community association client to conduct an audit or other financial procedure. All too often the response is “No. Do we have to?”    Read more……..

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Tax Cases (And Rulings) Of 2014: A Big Break For Home Builders

This was more than just marketing chatter, however, as Shea invested significant funds – upwards of 30% of total budgeted costs, in some developments — in the amenities – such as pools, golf courses, and clubhouses –for each neighborhood. In

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Homeowner Association IRS Ruling Highlights Schizophrenic Nature Of Associations

Unless they have vast reserves earning significant investment income, homeowners associations can avoid any significant tax liability by filing Form 1120H, which allows the organization to exclude assessments.    Read more……..

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Court Ruling May Result in Property Tax on Previously Exempt Community Association Property (NV)

A recent Nevada Supreme Court decision suggests that community association common areas may be subject to property tax based upon the value of common area improvements, even if the underlying land is effectively valueless because it is encumbered by restrictions

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Does your community file the proper tax return?

Last week I was fortunate to sit in on a continuing education class provided by Donna Seidenberg and Steven Price of the Fuoco Group (www.fuoco.com), certified accountants and business advisors. The class focused on the issues pertaining to association tax

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