Enforcing covenants of an association is one of the most difficult jobs a board of directors must embark upon, while at the same time being one of the most critical functions of the board. Most declarations of common interest communities specifically state that the purpose of the association is to protect and enhance property...
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Recent Posts by ideaforge
“Excuses, Excuses”
An excuse has been defined as “the skin of a reason stuffed with a lie”. There are two Boardmember sentiments we hear most frequently expressed: “We can’t afford the Reserve Funding Plan” and “We’ll worry about that next year”. But no matter how many times a Boardmember may repeat these sentences, it doesn’t mean they’re true and it doesn’t mean they’re wise. After we look beneath the skin of these two reasons, it may surprise you how differently you feel about these excuses!
Associations Using CPA’s: Is it Really Necessary?
Although homeowner associations are created as nonprofit corporations, this does not mean the associations do not engage in financial transactions or require the services of a certified public accountant (CPA). For example, it is common for an association’s governing documents to require a financial audit or review on an annual basis, and associations are required to file tax returns every year. Further examples of situations in which it may be beneficial to consult a CPA include:
Community Associations and the IRS
We often get asked whether community associations can or do qualify as 501(c) organizations under the Internal Revenue Code. Sometimes the question arises because the association derives too much income from sources other than assessments to file IRS Form 1120-H, and it is looking at way to...