Franchise Tax Board
When SwedelsonGottlieb engages a new client, we review the community association's corporate status. In doing so, we have found that not all community associations are aware of certain requirements to file taxes with the State of California. The result of failure to file taxes is the suspension of corporate status by the California Secretary of State, which has big implications for association board and members.
Most California Community Associations are exempt from paying taxes, provided that they meet a two-part test and file the required forms with the Franchise Tax Board. However, this does not remove the requirement to file taxes each year.
Should your association find itself in this predicament, our knowledgable attorneys have the experience to guide you through resolution and reactivation of the corporate status.