What IRS Form 1120-H (2024) Is For

Form 1120-H is the U.S. Income Tax Return for Homeowners Associations that allows qualifying associations to take advantage of special tax benefits under Internal Revenue Code Section 528 (IRS Instructions for Form 1120-H (2024)). It excludes exempt function income such as member dues, fees, and assessments, taxing only non-exempt income at 30% (32% for timeshares) after a $100 deduction.

When You’d Use Form 1120-H for 2024 (Late or Amended Filing)

You would file Form 1120-H for 2024 late if the association missed the April 15, 2025 (or September 15, 2025 with extension) deadline, often after receiving IRS notices. Amended filings are required for errors like misclassified income or missed deductions. Late filing may force associations to use Form 1120 instead, resulting in higher compliance burdens.

Key Rules Specific to 2024

• Minimum late filing penalty increased to $510 for returns filed more than 60 days late
  
  
• Electronic filing became available in January 2025
  
  
• Associations filing 10 or more returns of any type must e-file Form 1120-H
  
  
• Flat tax rates remain at 30% (condominiums/residential) and 32% (timeshares)
  
  
• Associations must pass 60% income test and 90% expenditure test to qualify
  
  

Step-by-Step (High Level)

• Gather transcripts: Request IRS Form 4506-T to confirm past filings or verify non-filing
• Complete Form 1120-H: Use the correct 2024 version and check “Amended return” if applicable
• Attach required schedules: Include supporting schedules such as Forms 4136 or 3800
• Choose filing method: Mail to Kansas City, MO or Ogden, UT, or e-file if required
• Keep records: Maintain signed copies, supporting documentation, and proof of submission

Common Mistakes and How to Avoid Them

• Misclassifying income: Only owner-paid dues, fees, and assessments qualify as exempt
  
  
• Failing 60%/90% tests: Associations must meet both to use Form 1120-H
  
  
• Using wrong-year forms: Always file the 2024 version for 2024 taxes
  
  
• Omitting amended return box: Check the box when filing corrections
  
  
• Missing required signatures: Authorized officers must sign, or IRS will reject
  
  
• Ignoring e-file mandates: Filing on paper when e-filing is required can result in penalties
  
  

What Happens After You File

The IRS processes paper Form 1120-H filings within 6–8 weeks and e-filed returns in 2–3 weeks, though amended returns can take 8–12 weeks. You may receive notices requesting clarification on qualifications or classifications. If tax is owed, installment plans are available for balances up to $25,000. Appeal rights exist for any IRS adjustments or disputes.

FAQs

How do I get transcripts of previously filed Form 1120-H returns?

Use IRS Form 4506-T to request transcripts or log in through your IRS business tax account. Transcripts provide filing history, reported income, and payments, helping identify missing years or confirm compliance. Having transcripts before filing late or amended returns ensures accuracy and avoids IRS mismatch notices that could result in further penalties or delays.

What penalties apply for filing Form 1120-H late?

Late filing penalties equal 5% of unpaid tax per month, up to 25% maximum. For 2024 returns filed more than 60 days late, the minimum penalty is $510 or 100% of the unpaid tax, whichever is smaller. Failure to comply may also result in losing Form 1120-H election rights and defaulting to Form 1120.

Can I still amend my 2024 Form 1120-H if I discover errors later?

Yes, you can file a corrected 2024 Form 1120-H at any time by checking the “Amended return” box. While there is no limit on corrections increasing tax owed, refund claims follow standard timeframes. Amending ensures accurate reporting and maintains proper compliance records, even when refunds are no longer available after the statute expires.

Do I need to amend state returns if I amend my federal Form 1120-H?

In most states, yes. Amending your federal return generally requires you to also amend your state return. State tax rules differ, and some states do not recognize federal HOA exemptions. Always check with your state’s tax authority to ensure compliance and avoid separate penalties or enforcement actions tied to uncorrected state returns.

What if my association never filed any tax returns for multiple years?

You must file all missing years beginning with the oldest return. Unfiled years expose the association to significant penalties, interest, and possible IRS enforcement actions. Filing multiple late returns demonstrates good faith and may support penalty abatement requests for reasonable cause, especially if the lapses were due to management changes or extraordinary circumstances.

How long does it take to process an amended Form 1120-H?

Amended returns usually take 8–12 weeks to process fully, though you may receive interim notices if the IRS requires clarification. You can track processing status online through your IRS business account or by calling the IRS business line. Maintaining copies of mailed filings ensures you can respond quickly to any correspondence or inquiries.

Can I e-file a late or amended Form 1120-H for 2024?

Yes. Starting in January 2025, Form 1120-H became eligible for e-filing, and associations filing 10 or more returns of any type are required to submit electronically. E-filing ensures faster acknowledgment and processing compared to paper. Paper filing is still allowed for smaller associations unless they meet mandatory e-file requirements for volume thresholds.

‍