At the start of the year, many HOA Board members feel pressure to get organized. Brand new HOA Board members are trying to acclimate and learn their roles, in addition the veteran members are tying up loose ends from the year prior. Getting organized is an overwhelming task, but the pay-off is vital to the health of the HOA (also known as Community Association).
Here’s a checklist to get the HOA Board organized:
- File the Associations Annual Report. Follow your Corporation Commission requirements. Failure to file with the Corporation Commission may cost the HOA fees. Failing to file could lead to administrative dissolution which means the state will no longer recognize the Community Association is a legal entity.
- Consolidate HOA Common Area Tax Parcels. This may save the Community Association money. Check your county assessor website for additional information and FAQ’s.
- Review Insurance Requirements. Take a careful look at your governing docs and ensure the HOA has enough coverage. Conversely, do you have too much? If you aren’t sure, contact an insurance expert or the Community Association attorney to review the governing docs and insurance policies. For example, Directors and Officers Liability Insurance. is one type of coverage that is sometimes overlooked.
- File Correct Tax forms. Most not for profit associations file an 1120H vs. 1120. An 1120H filing (click link to IRS form) will allow an HOA to take advantage of certain tax benefits.
- Complete an Annual Audit. Sometimes called a “review” or “compilation” of year end financials. Follow review guidelines set by your governing docs and state statutes.
- Ensure Minutes are Accessible. Are your resolutions, amendments, and meeting minutes on file and accessible? This is the last item on your checklist. Having these organized at start of the year will decrease headaches when trying to locate information to resolve a situation, or review a previously made decision.
That’s it! 5 easy steps that will surely get the HOA organized for the new year.
