Cohousing-L Mailing List: Question re: HOA taxes

[Zita Xavier (zitaxavieris]

Hi Everyone,
At Heartwood Cohousing, a private group within our community has developed
Heartwood Farms. In consideration now is whether or not to officially
incorporate Heartwood Farms under our HOA structure. One concern is the
impact on HOA taxes. Now in year three, our very successful Farm is still in
the building out stage and we are looking for ways to raise money to build a
barn and some other outbuildings. We know HOAs have to pay big taxes on the
wrong kind of income, maybe as high as 50%?  Ouch. How would this impact us
if we're raising large amounts of income, paying back loans, buying assets,
or saving up to buy future assets?  Can anyone give us some insight on HOA
tax law?
Thanks so much,
Zita Xavier