|HOA income, taxation, and insurance "cans of worms" (was flip taxes)||<– Date –> <– Thread –>|
|From: Deborah Mensch (deborahmenschgmail.com)|
|Date: Mon, 12 Feb 2007 09:45:07 -0800 (PST)|
On 2/12/07, Michael Barrett <mbarrett [at] toast.net> wrote: (in the context of the thread on flip taxes)
Does not any payment made to the HOA count as income, and thus be potentially liable for taxation?
Please pardon me if this question is naive, but doesn't an HOA receive income every month in the form of homeowners' fees, and sometimes other income such as buyout fees for work systems, etc.? Is there something special about other forms of income that make them more problematic to deal with? I guess this has come up about payments for classes held in the common house, donations for guest rooms, and other situations, too. I am in a new forming community, and the question whether HOAs should shy away from events with tax consequences (such as having an employee or extra sources of income) or liability consequences (such as having residents do physical labor, or neighbor kids play, on the premises) keeps popping up in cohousing conversations. I'm assuming we will be paying taxes, and probably carrying workers' comp and liability insurance as part of our HOA insurance anyway, so where do the problems come in? I can certainly sympathize with the plight of volunteer bookkeepers if an action opens a whole new can of worms on accounting or taxes, or with those who keep up with insurance if an action makes the HOA more expensive to insure or harder to buy insurance for; but I don't know whether these are the case. Can anyone enlighten me as to where "ordinary" ends and "new can of worms" begins? Does it depend on the HOA's legal status? Thanks much, Deborah Mensch Member, Tumblerock forming community, central Colorado Currently at Pleasant Hill Cohousing, Pleasant Hill, CA
HOA income, taxation, and insurance "cans of worms" (was flip taxes) Deborah Mensch, February 12 2007
- Re: HOA income, taxation, and insurance "cans of worms" (was flip taxes) David L. Mandel, February 12 2007
- Re: HOA income, taxation, and insurance "cans of worms" (was flip taxes) Dahako, February 13 2007
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