Understanding the Distinction: My Ongoing Battle with My HOA’s Non-Profit Status

Navigating the complexities of homeowner associations (HOAs) can sometimes feel like an uphill battle, especially when questions arise about their legal structure. I find myself in a bit of a predicament with my HOA, and I would appreciate any insights from those who are well-versed in these matters.

Recently, I stumbled upon some intriguing information: my HOA’s name appeared on a list indicating that its tax-exempt status was revoked approximately a decade ago. This revocation occurred due to the failure to submit three consecutive years of IRS Form 990, which is typically required for non-profit organizations.

Upon examining our HOA’s charter more closely, I realized that while they still operate under the same title, they now refer to themselves as a “not-for-profit” organization rather than a non-profit. This distinction piqued my interest—especially since they generate revenue through membership dues and fundraising events. However, I find myself perplexed by the processes involved in transitioning from a non-profit to a not-for-profit status.

Is it even feasible for an organization that once held non-profit status to simply declare itself as not-for-profit without any formal process? My state’s business lookup tool revealed two entities with names similar to the HOA: one is an LLC, and the other a C Corporation. It leads me to speculate that the HOA might have transitioned to the corporate structure, possibly neglecting to file a final Form 990 for the non-profit in the process, thereby allowing it to dissolve while still employing the established corporate entity.

What’s particularly concerning is that the non-profit organization continues to own the property in our community, and there are no references to any other entity in the charter. The name of the original non-profit still appears on official documents, adding to the confusion.

I am eager to gather perspectives from others who may have encountered similar situations. Is there a way to verify the status of the HOA’s non-profit designation? It would certainly be unfortunate if they are not in good standing, as this could have implications for the community and its residents.

For those familiar with New Jersey’s regulations or HOA governance, your insights would be invaluable as I seek clarity in this complex situation. Thank you in advance for your help!