tax and legal issues for common house usage
From: astromezzo (astromezzomac.com)
Date: Sat, 2 Aug 2008 19:38:14 -0700 (PDT)
We have had some interest in charging for use of common facilities such as payment for events in the common house, lodging in the common house, and use of laundry facilities. How have other communities handled the accounting for these types of income for tax purposes? Since it's not directly related to the maintenance of common property, I know it's not exempt income even if it comes from members of our community, but I know we can deduct expenses against this income in order to reduce our taxable income.

But then how, for example, do you calculate the expenses to deduct for use of the common house for an hour in a manner that satisfies the IRS? Also, does charging for overnight guests in a common house bring up licensing and/or insurance issues with being a hotel or boarding house?

-Rosemary
Rocky Hill Cohousing
Florence, MA

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