Are Homeowners Association Fees Tax Deductible

With so many bills and expenses you have to deal with, paying homeowners association fees is not something you particularly look forward to doing. HOA fees can be small or large, ranging from $50 per month to possibly $1,000 per month in large complexes that offer many specialty services. That can add up to a significant amount of money at the end of the year and it would be great if there was a way to recoup some of it. Since it is an expense you can’t get away from in your community, you may be wondering if homeowners association fees are tax deductible.


What Do Homeowners Association Fees Pay For

If you have never lived in a community with an HOA, then you may also be wondering just what you get for your money. What do those fees pay for? It will depend on the specific HOA, but the basics include general upkeep and maintenance of common areas which includes things such as snow removal and landscaping. If there is a pool or clubhouse, your fees will pay for the maintenance and operation of those services. There may be security services for the community, which again will be paid for by your HOA dues. Essentially, any service provided for the community at large by the association will be paid for from HOA dues.


Homeowners Association Fees and Your Taxes

Unfortunately, these fees are, in almost all cases, not tax deductible. The reason the IRS does not allow you to deduct them from your taxes is because they are not charged by a government or state agency, but by a private association. There is, however, a specific case in which your HOA fees may be deducted from your taxes. If you rent out the home, condo, apartment or townhome, and you pay the HOA fees for the renters, then you can deduct them from your taxes. The reason is that the HOA fees are, in this instance, considered a necessary expense of running your business.


Other Home Related Expenses That Can Be Deducted

Though you are most likely unable to deduct your homeowners association fees, there are other expenses related to your home that you can deduct. These include real estate taxes, interest paid during the year on your mortgage and mortgage interest premiums. If you are renting out the living space, then in addition to deducting homeowners association fees, you may also be able to deduct repair costs, utilities, legal fees and taxes.

Try to put those homeowners association dues out of your mind while you kick back with your favorite cocktail by the clubhouse pool. At least you’re getting some enjoyment from those pesky HOA dues.




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