Interest Bearing Accounts

Dorothy, definitely. Reserve funds should be invested in income bearing low risk accounts which have the requisite liquidity. BTW, HOAs are not-for-profit organizations, which are different than non-profits which do not pay taxes. HOAs pay taxes on interest income and other funds generated "outside" of the HOA.

Thank you Roger. Our official seal from the Secretary of State says "Non-Profit." I'm going to ask our Treasurer at our Board meeting Tuesday what she does in regards to taxes. I do know that a homeowner adamantly insisted we could not put any monies into any interest-bearing accounts,and so we never did. That never sounded right to me. Our Treasurer is resigning the end of this year, so I very well may be taking over that mantle as no one has expressed any interest in volunteering after three requests.

Brian,
This fellow was President before me, and a really rotten one, as no one could tell him anything that he didn't "already know." I said to him, "But that's what endowments are." He just grinned and gave me a look that said, "You poor dumb thing." I get along well with him, though, because you just have to know when to separate the fact from the fiction. It could be, given the barely-has-a-pulse nature of this Association, no one ever wanted to have to deal with the tax requirements. On the other hand, the pulse is rarely elevated because we have an amazing bunch of self-contained, non trouble-making, easy-going bunch of neighbors. Knock on wood!