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Subject: Ad Valorem - Property Taxes - Florida
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Author Messages
ToddR4
(Florida)

Posts:23


01/11/2018 10:50 AM  
We are in the process of voting on an 11,000 clubhouse expansion to an existing 6,000 building. I won't bore you with all the drama.

Question - how are property taxes handled when an improvement is made to a common area of this magnitude?

Typically, common areas are not taxed, but nothing is for free. Is the impact distributed via individual property owners tax bills within the community?

We have an inquiry into the local property appraisers to get a proper answer.

Any experiences out there in Florida?
CjC
(Maryland)

Posts:138


01/11/2018 11:04 AM  
Who actually owns the building? The HOA?
ToddR4
(Florida)

Posts:23


01/11/2018 11:14 AM  
Yes, the HOA owns the common areas.
RichardP13
(California)

Posts:3054


01/11/2018 11:48 AM  
The homeowners within the association will pay the taxes through improvements to their own property, in this case the common area improvement. In California, the assessed value is generally land and improvements. It also may be itemized on your tax bill under improvements, which may not indicate where the improvement was, local or association.
DouglasM6
(Arizona)

Posts:724


01/11/2018 1:11 PM  
Posted By ToddR4 on 01/11/2018 10:50 AM
We are in the process of voting on an 11,000 clubhouse expansion to an existing 6,000 building. I won't bore you with all the drama.

Question - how are property taxes handled when an improvement is made to a common area of this magnitude?

Typically, common areas are not taxed, but nothing is for free. Is the impact distributed via individual property owners tax bills within the community?

We have an inquiry into the local property appraisers to get a proper answer.

Any experiences out there in Florida?




That is what I call inviting the bear into your camp. Good Luck.

I have no experience in Fl tax law so I'll sit on the sideline and watch this one.
ToddR4
(Florida)

Posts:23


01/11/2018 1:22 PM  
Love the analogy, Doug. Inviting the bear.

The problem is without money and legal representation, you can never ever get a straight answer.

The property appraiser should be able to give an simple answer, but they have to research issue and call us back.

You can't make this stuff up!
DouglasK1
(Florida)

Posts:1232


01/11/2018 5:30 PM  
We don't have clubhouse or buildings, but all of our common area tracts are assessed at $100 each (4 in total). Apparently the resulting tax falls below some threshold so we don't actually pay the tax due on the $100 valuation.

I would assume the $100 valuation would be the same no matter what we did on the common area tracts, so expanding a clubhouse would probably not change the association tax. The tax on the lots does not include a surcharge, or any higher ad valorum amount because of the common areas, so I would not expect the owners tax to go up either if we made improvements.

If I find some time, I'll try searching on HOAs with clubhouses here on the county property appraiser site and see if they appear to be handled differently.

Escaped former treasurer and director of a self managed association.
DouglasK1
(Florida)

Posts:1232


01/11/2018 5:30 PM  
We don't have clubhouse or buildings, but all of our common area tracts are assessed at $100 each (4 in total). Apparently the resulting tax falls below some threshold so we don't actually pay the tax due on the $100 valuation.

I would assume the $100 valuation would be the same no matter what we did on the common area tracts, so expanding a clubhouse would probably not change the association tax. The tax on the lots does not include a surcharge, or any higher ad valorum amount because of the common areas, so I would not expect the owners tax to go up either if we made improvements.

If I find some time, I'll try searching on HOAs with clubhouses here on the county property appraiser site and see if they appear to be handled differently.

Escaped former treasurer and director of a self managed association.
TimB4
(Virginia)

Posts:15999


01/11/2018 6:22 PM  
I would expect that whomever is paying property taxes on the current clubhouse will continue to pay property taxes on the improved clubhouse.

Don't forget to update the property insurance on the clubhouse.
JohnC46
(South Carolina)

Posts:7760


01/12/2018 8:33 AM  
Posted By TimB4 on 01/11/2018 6:22 PM
I would expect that whomever is paying property taxes on the current clubhouse will continue to pay property taxes on the improved clubhouse.

Don't forget to update the property insurance on the clubhouse.




Makes sense as ownership is not changing.
RichardP13
(California)

Posts:3054


01/12/2018 8:49 AM  
Property taxes MUST be collected. Anyone know who is paying those taxes?
PaiN


Posts:0


01/12/2018 9:59 AM  
The HOA, if a common element.

If not, wait for the tax sale
CjC
(Maryland)

Posts:138


01/12/2018 10:20 AM  
If you are a not for profit, do you pay property taxes?
RichardP13
(California)

Posts:3054


01/12/2018 10:27 AM  
Posted By PaiN on 01/12/2018 9:59 AM
The HOA, if a common element.

If not, wait for the tax sale



If the HOA is paying the tax, how are they paying? Of all the properties I have managed or been involved with, I have never paid a property tax bill on behalf of my clients.
AllumW
(Florida)

Posts:67


01/12/2018 10:31 AM  
When I checked tax records for the properties in our neighborhood, theres no tax bill due. It shows 0.00 for the past several years.
PaiN


Posts:0


01/12/2018 10:38 AM  
Not the way it works for 'improved' common property in SC.

The 'improvements' themselves are taxed as they are 'real property'.

? Perhaps the OP's improvements were never actually recorded ?


The bear seems welcome
RichardP13
(California)

Posts:3054


01/12/2018 10:56 AM  
Posted By PaiN on 01/12/2018 10:38 AM
Not the way it works for 'improved' common property in SC.

The 'improvements' themselves are taxed as they are 'real property'.

? Perhaps the OP's improvements were never actually recorded ?


The bear seems welcome



I have to assume then that the property taxes are a line item on the annual operating budget.
PaiN


Posts:0


01/12/2018 11:44 AM  
yes, they are
GenoS
(Florida)

Posts:2430


01/13/2018 12:26 AM  
Posted By ToddR4 on 01/11/2018 10:50 AM
We are in the process of voting on an 11,000 clubhouse expansion to an existing 6,000 building. I won't bore you with all the drama.

Question - how are property taxes handled when an improvement is made to a common area of this magnitude?

Typically, common areas are not taxed, but nothing is for free. Is the impact distributed via individual property owners tax bills within the community?

Yes, that is generally how it works. The tax burden for the common property - including your clubhouse - is divided up among the individual tax bills of the homeowners. Your county appraiser should be able to give you some more information.
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Forums > Homeowner Association > HOA Discussions > Ad Valorem - Property Taxes - Florida



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