Are homeowners association assessments tax deductible?
Dues are not deductible by a owner-occupant. Theoretically, the portion of an owner’s assessment which has been earmarked by the association for it’s reserves, if done properly, can be added to the cost basis of the owner’s home. However the additional recordkeeping required of the owner and the small amount of money involved make this not cost effective, in most cases. On the other hand, if an owner rents out his residence, association dues are deductible as “ordinary and necessary” expenses on Schedule E of the owner’s tax return.
