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All associations that elect to be taxed as a homeowners association are entitled to a speciï¬c $100 deduction from its taxable income. This means that associations with relatively small amounts of taxable income could have their tax liability eliminated by the application of the speciï¬c $100 deduction.
If you live in your property year-round, then the HOA fees are not deductible. Though many costs of owning a home are deductible on your income taxes, including your mortgage interest and property taxes, the IRS does not allow you to deduct HOA fees, because they are considered an assessment by a private entity.If the home is a rental property, however, HOA fees do become deductible.In this case, the IRS considers HOA fees to be a deductible cost of maintaining the rental property You report the fees on Schedule E on your tax return.f your property is a second home or vacation home that you use personally but also rent out, things get a bit more complicated. You still can deduct HOA fees but only for the time the property is used as a rental.