The Taxman Cometh


By Mike Cukierski, Cukierski & Associates C


ommunity associations often operate under the assumption that they are “nonprofit organizations” in the same way as charitable institutions. This belief stems from the fact that most associations are incorporated as nonprofit corporations under state law. While that status governs organizational structure and liability, it does not determine federal tax treatment. The IRS does not view community associations as tax exempt organizations. Instead, they are treated as corporations that must file a federal income tax return each year unless they qualify for and elect a specific filing status. Understanding how federal tax law applies to community associations is essential for boards seeking to protect their financial resources and avoid unnecessary tax exposure.


8 | COMMON INTEREST® • Spring 2026 • A Publication of CAI-Illinois Chapter


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