voluntary homeowners association

[PayrollHRGuy]

My point is that no questions on the 1024a are even remotely indicative of the above discussion, so there would be no reason for the overworked examiner to ask for more information.

The publication does state "The association should submit evidence that areas such as roadways and park land that it owns and maintains are open to the general public and not just its own members."

 

[Taxing Matters]

My point is that no questions on the 1024a are even remotely indicative of the above discussion, so there would be no reason for the overworked examiner to ask for more information.

Then you don't understand the form and how the IRS examiner will review it. Part III of the form is a critical part of it despite the small space on the form for it. You must give a full and accurate description of your organizations activities, which in this case means describing that you do well testing for members but not others, along with any other things you do that you have not mentioned here. This is one reason why having a lawyer assist with the form is important. How you describe your activities matters.

In addition to that, you will have to check the box about being a HOA. You must also fill out the financial data. When you do that, the examiner will see that your organization does not own any real estate — it has no common areas it maintains. Those two things together should trigger the examiner to dig deeper to find out exactly what you do if you don't accurately and fully spell it out for Part III.

A lot of people who are not tax lawyers that fill in these forms think them more simplistic than they are. That's a mistake. That's how organizations screw up applications.