In a recent decision, the Indiana Tax Court has kept alive a limited portion of a Homeowners’ Association’s (HOA) claims using what was historically known as Indiana’s Form 133 Petition for Correction of Error (Form 133). In Muir Woods Section One Assn., Inc., et al v. Marion County Assessor, Joseph P. O’Connor, 19T-TA-00025 (Ind. Tax […]
Preparing for Tax Season
As the end of the year approaches, we will soon be entering tax season. To help your board prepare for this busy time, SpectrumAM has put together some common questions regarding HOA taxes: Read the article………………………………
Tax Court partially reverses tax board’s dismissal of HOAs’ common area claims (IN)
A final decision by the Indiana Board of Tax Review that dismissed claims from three homeowners associations was partially reversed by the Indiana Tax Court in a Monday decision. Read the article……………………………..
Federal Form 1120-H, 990 or 1120? Changing Your Condominium’s Tax Filing Status Can Net Savings
For the uninitiated, tax filing for something as complicated as a community association can seem more than daunting. Fortunately, there are multiple options for homeowners associations, and with a little background knowledge, you can take the first steps toward making the right choice for your particular situation. Read the article……………………………..
Homeowner’s Association Denied Tax Exempt Status
A homeowner’s association doesn’t qualify for tax-exempt status because it’s operated primarily to benefit the owners of condominium units and not to benefit the social welfare, the Internal Revenue Service said… Read the pertinent IRS section…………………………
Homeowners Association Operator Ruled Not Tax-Exempt
The operator of a homeowners association doesn’t qualify for tax-exempt status because it doesn’t benefit the general welfare but instead furthers the interests of its members, the Internal Revenue Service said Read the PDF from IRS………………………………..
HOA Tax Returns: A Complete Guide
Are you an HOA board member who’s struggling with your association’s tax return? Filing an HOA or condo association tax return can be challenging if you’ve never done it before or don’t understand the rules or what’s involved in the process. Maybe you didn’t even realize that your HOA is required to file a special […]
For Manhattan Co-op and Condo Owners, Tax Increases May Depend on How Long They’ve Owned (NY)
Q. I’ve been reading about the proposed property tax changes in New York City. What does that mean for me as a Manhattan condo owner? Read the Q&A………………………………
Condo Smarts: At tax time, get strata to consult with accountant (BC)
The lines of taxation get blurry when strata corporations run a commercial enterprise or use or lease property to a significant benefit of the corporation that results in financial benefits to the owners. Read the article……………………………..
Cooperative and Condominium Tax Abatement Safe from Prevailing Wage Requirement (NY)
Coops and condos will not need to pay their service employees prevailing wages to keep their units eligible for the Cooperative and Condominium Tax Abatement (the abatement). The abatement reduces property taxes between 17.5 and 28.1 percent on average, depending on the assessed value of the units in the development. Read the article…………………………….
Owners at affordable condo to appeal after seeing their property taxes skyrocket (HI)
Nearly 50 owners of affordable condos at an Ala Moana area highrise are appealing their city property tax assessments. The owners of the units at 1631 Kapiolani Blvd. said the city is incorrectly using sales of nearby high-end condos to value their studios, which unlike market-priced units, have strict restrictions on resale. Read the article……………………………..
The Ultimate HOA Tax Season Cheat Sheet
When tax season rolls around, you’re probably focused on filing your personal tax returns, but don’t forget that it’s tax time for your HOA, too. As a board member, we know HOA taxes can be confusing, but we’re here to help. In this post, we answer the most frequently asked HOA tax questions, so you’re […]
Treasurer to look at office’s relationship with special tax districts (SC)
Cathy Miller is looking to make changes at the Greenwood County Treasurer’s Office. The former Beyond Abuse director was named treasurer in October and wants to change how her office handles special tax districts, which Greenwood County Council approved creating in December 2014. Read the article…………………………….
As Abatements End, Condo Property Taxes Soar (NY)
Nothing is certain but death of tax abatements. The 421-a tax abatement ended in 2016, but the benefits of the expired program continue for many luxury condo unit-owners. Now, as the 10- to 25-year abatements phase out, the owners of those apartments are seeing staggering increases in their property taxes – just as the once-robust […]
The Taxman Cometh for Some Condos (NY)
Buyers, take note: Discounts can be found as thousands of luxury apartments are set to lose a valuable tax break in the midst of a softening resale market. Read the article……………………….
Colorado metro districts and developers create billions in debt, leaving homeowners with soaring tax bills (CO)
Metro districts are taxing authorities created by subdivision developers, with the consent of the local government, for the sole purpose of selling government-like bonds to finance their projects. Repayment of the bonds is tied to future property taxes assessed to the homes that will eventually be built. Read the article………………………….
The Landing at Dobbs Ferry sues Greenburgh assessor in condo tax dispute (NY)
For more than a year-and-a-half, Greenburgh Assessor Edye McCarthy has refused to certify tax parcels at The Landing on the Water at Dobbs Ferry, according to the owners, thus preventing them from having their deeds officially recorded when they sell their property. Read the article…………………………
Are HOAs Non-Profit?
Homeowners’ associations are often organized as non-profits. By incorporating non-profit status into the bylaws of the community, the association is always registered as a non-profit. So, how does the IRS treat an HOA? Are homeowners’ associations corporations? Do HOAs have to file tax returns and pay taxes? These are very common questions and ones that, […]
Taxes As Relating To Associations (NC)
Tax season isn’t just a fun time for residents and businesses in North Carolina, it’s also a big piece of the financial puzzle for homeowners associations (HOAs). As complicated as federal and state income taxes may seem to everybody else, they can also provide some twists and turns for HOA board members and are something […]
The 5 Most Commonly Asked Questions Regarding Association Group Property Tax Appeals (IL)
This year, property owners all over Chicagoland are receiving notices from the County Assessor indicating their property’s new assessment. While all property owners should consider appealing their new assessment to lower their future property taxes, you should consider filing your tax appeal as a group if you live in a condominium, townhome or homeowner association. […]
Napa Sanitation District disputes condo rate lawsuit (CA)
Napa Sanitation District is disputing a lawsuit’s claim that the sewage service bills charged to condominium and townhouse owners has for four decades really been an illegal tax. “The district has embedded this fatal tax error into all of its ‘rate setting’ that has occurred since at least 1975,” the plaintiff’s attorney, Geoffrey Willis, wrote […]
Judge rules against Philly’s assessments of high-rise condos with tax abatement (PA)
In a case that involved a few of the city’s most prominent luxury condo buildings, a judge has ruled that Philadelphia’s method for assigning land values to nearly 300 condo units with 10-year tax abatements was improper and not credible. Read the article………………………
J-51 Tax Abatement Extended and Expanded (NY)
More co–op and condo owners will now have the opportunity to join a previously expired tax abatement program, thanks to a bill signed into law earlier this month, Qns.com reports. The J–51 tax abatement, which helps co-ops and condos make costly capital improvements, now allows properties with an assessed value of up to $40,000 to […]
How to Keep a Condo Association Tax-Free (NY)
Some condominiums with a mix of residential and commercial space do not qualify as a homeowners association under the tax code. This means that any budget surpluses may be taxed just as they are for a Fortune 500 company, even though your intent was not to generate a profit. In effect, you can wind up […]
How to Keep a Condo Association Tax-Free (NY)
Some condominiums with a mix of residential and commercial space do not qualify as a homeowners association under the tax code. This means that any budget surpluses may be taxed just as they are for a Fortune 500 company, even though your intent was not to generate a profit. In effect, you can wind up […]
Will a Condo Owner Be Liable for a Delinquent Neighbor Not Paying Property Taxes? (NY)
Q. I own a condo unit in Queens, New York, with more than 500 units. I noticed an increase in my quarterly tax bill, which had a note at the end that stated, “Please contact your managing agent so that the delinquent charges are paid to avoid the possibility of being included in the next […]
Who Pays the Property Taxes on a Golf Course Development in Florida?
Q. I am thinking about buying a home on a golf course development in South Florida. Do homes like that typically have their own property taxes or are taxes paid through the development? Read the Q&A…………………………
Is Your Association Missing Out on a Utilities Sales Tax Exemption? (FL)
Some associations are unaware that they could be entitled to an exemption for the sales tax related to a major expense – utilities for common areas serving exclusively residential properties, including condominiums and homes in a homeowners’ association. However, nonresidential uses are not exempt. Read the article……………………….
1099’s for HOAs: Why Filing is Important
As a legal business entity, your HOA must file taxes. Filing is an important thing to do, and there is one form in particular that you should know about, and that’s the 1099-MISC form. If you have a property management company, they will likely take care of most of the tax filing process for you, […]
Can my condo’s maintenance fees be added to my cost basis? (NJ)
Q. I have a condominium in a multi-story building and I pay a monthly maintenance fee. Some of the money is used for capital improvements, such as a new roof or building ventilation system. May my share of these long-term improvements be added to the cost basis of my condo? Read the Q&A…………………..
Waterfront? Homeowners with retention pond see property value spike (SC)
Mecklenburg County officials call homes with retention ponds in its backyard “waterfront property,” making home values skyrocket. With a higher value, they will have to pay more taxes. Read the article………………….
Condo Property Assessment
Question: I read your column faithfully and was hoping you could address a small issue/question I have. Recently, I received from my association a bill for property tax assessment challenges. It appears the association took it upon themselves to hire a property tax attorney, without notice to the homeowners (or at least, I never received […]
Can You Claim HOA Fees on Your Taxes?
When the holiday season approaches, many homeowners begin preparing for the year ahead. Contemplating New Year’s resolutions is common during this time, and a popular resolution is to become more financially stable. One of the most satisfying ways to get money back into your pocket is through tax refunds. This poses the question of whether […]
Dobbs Ferry community sues state AG, aiming to pay less in taxes (NY)
The Landing at Dobbs Ferry, a residential complex, has filed an Article 78 lawsuit against Attorney General Barbara Underwood and her staff for allegedly abusing their power to stifle the community’s effort to change its status from a single-family-home community to condominiums. Read the article………………
How to Become Tax Exempt as an HOA (TX, AZ)
Being tax exempt could save your HOA money in annual tax return forms, but achieving exemption is trickier than it looks. Homeowners associations are usually already considered nonprofit corporations, but just being a nonprofit doesn’t automatically make an HOA tax exempt, or even eligible for tax exemption. Here, we’re going to answer some basic questions […]
HOA sues NY Attorney General Underwood over condo conversion (NY)
Homeowners at the Landing at Dobbs Ferry found a way to minimize the impact of a new federal tax law last year by converting their homes to condos. But when they tried to make the conversion to save about $1 million a year on property taxes, local government officials and the New York State attorney […]
Legislative Fix Needed in Condo Association Property Tax Assessment Appeals Ruling (FL)
Condominium associations regularly represent all of their unit owners as a consolidated class of litigants in cases challenging their local county ad valorem property tax appraisal assessments. However, a vital segment of the representation that associations provide their owners in such actions may soon be coming to an end as a result of a recent […]
Does your HOA qualify for Form 1120-H?; HOA No Private Inurement Test
Homeowner (and condominium) associations hold an unusual place in the tax world. On the one hand, most do not squarely meet the definition of a 501(C) nonprofit. On the other, they are not in business pursuing a profit. In fact, the vast majority of HOAs are small, volunteer-run associations that function solely to enforce covenants […]
A $400 Tax Rebate Proposed for “Middle-Class” Co-ops and Condos (NY)
In the upcoming May issue of Habitat, we’ll take you inside the looming battle to reform New York City’s archaic, arcane, and inequitable property tax system. Among the highlights are a lawsuit by an unlikely coalition called Tax Equity Now New York, which argues, among other things, that the current system discriminates against minorities. There […]
Florida Supreme Court rejects Escambia County’s request to consider beach tax case
Florida’s highest court has declined to consider a lower court’s ruling involving lease fees paid to Escambia County by Pensacola Beach condominium owners. Wednesday’s announcement by the Florida Supreme Court followed an October decision against the county by Florida’s First District Court of Appeal. At issue is whether the county can collect property taxes on […]
3rd District panel affirms denial of class certification in case over assessed value of condos (FL)
Three 3rd District Court of Appeal judges have affirmed a lower court’s decision to deny class certification in a consolidated case involving two condominium associations. Judges Vance Salter, Kevin Emas and Ivan Fernandez affirmed the lower court’s decision in a March 21 opinion that Pedro J. Garcia and others be able to appraise each condominium […]
Clock Is Ticking on Tax Abatement Filings (NY)
Missing paperwork has cost nearly 2,000 New Yorkers – including many condo unit-owners – their coveted 421-a tax abatements. Those owners and their condo boards are now scrambling to get their paperwork in order, and they have until May 1 to do so – or forfeit tax breaks worth $66 million, Brick Underground reports. Read […]
What is HOA Exempt Function Income?
Homeowner (and condominium) associations hold an unusual place in the tax world. On the one hand, most do not squarely meet the definition of a 501(C) nonprofit. On the other hand, they are not in business pursuing a profit. In fact, the vast majority of HOAs are small, volunteer-ran associations that function solely to enforce […]
How to Determine Your HOA’s 1120-H Exempt Function Expense Percentage
Homeowner (and condominium) associations hold an unusual place in the tax world. On the one hand, most do not squarely meet the definition of a 501(C) nonprofit. On the other hand, they are not in business pursuing a profit. In fact, the vast majority of HOAs are small, volunteer-run associations that function solely to enforce […]
Does My HOA Need to File Form 1099-MISC?
All businesses and organizations, including homeowner associations, are required file 1099 Forms, including Form 1099-MISC, when they make certain payments to others. The legal structure of your HOA (or condo association) does not matter. If it makes any payments that require filing Form 1099-MISC, it must do so or face a stinging array of possible […]
The HOA Exempt Function Test
Homeowner (and condominium) associations hold an unusual place in the tax world. On the one hand, most do not squarely meet the definition of a 501(C) nonprofit. On the other, they are not in business pursuing a profit. In fact, the vast majority of HOAs are small, volunteer-ran associations that function solely to enforce covenants […]
HOA Electing Section 528 Test, Does your HOA qualify for Form 1120-H?
Before the Tax Reform Act of 1976, HOAs that were not approved as 501(C) nonprofit organizations were treated as for-profit corporations for tax purposes and required to file Form 1120, a business return. Form 1120 forced payment of tax on dues and assessments that exceeded expenses for each tax year. The Tax Reform Act of […]
Do HOAs Need to File a Tax Return?
If you own a home in a planned community or development, there is a good chance you are a member of a homeowners’ association (HOA). One perplexing aspect of HOA management is following the tax reporting requirements of the IRS. Some common questions our office receives are “Must our HOA file a tax return?” “What […]
Does your HOA qualify for Form 1120-H?
Homeowner (and condominium) associations hold an unusual place in the tax world. On the one hand, most do not squarely meet the definition of a 501(C) nonprofit. On the other, they are not in business pursuing a profit. In fact, the vast majority of HOAs are small, volunteer-ran associations that function solely to enforce covenants […]
Do HOAs Need to File a Tax Return? Yes! Here’s How
If you own a home in a planned community or development, there is a good chance you are a member of a homeowners’ association (HOA). One perplexing aspect of HOA management is following the tax reporting requirements of the IRS. Some common questions our office receives are “Must our HOA file a tax return?” “What […]