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When to File — or Not File — an Insurance Claim

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In today's stringent insurance market, condo board members, along with property managers, must carefully evaluate their claim-filing processes. Insurance carriers are increasingly selective about the risks they insure, with claims being a pivotal factor in their decisions regarding coverage renewal or new policies. Boards should consider six key points before filing a claim:

1) The property's recent claim history significantly influences insurer perceptions; large "shock losses" are often preferred over multiple smaller claims.

2) In the current market, it may be wise to refrain from filing claims for payouts under $5,000 to avoid negative impacts on future premiums.

3) Coverage extends primarily to sudden and accidental losses, excluding damages from wear and tear or lack of maintenance.

4) While agents can offer opinions, only filing a claim confirms coverage.

5) Claims below the policy deductible shouldn't be filed, as carriers won't make payments below this threshold.

6) Consulting a trusted contractor to assess damages and estimate costs can help determine if filing a claim is warranted.

Read more here.

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2023 Income Tax Returns for Condo Associations Due April 15th

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Condominiums associations are considered corporations in the eyes of the IRS. As such, they are required to file an annual tax return (either an 1120 or 1120-H).

Condo associations showing taxable income on their federal returns are also required to file an IL-1120 with the state of Illinois.

Tax returns must be postmarked by April 15th this year. If your association has not filed a return in the past, now is the year to begin!

Need help compiling your 2023 financials and filing your tax return? Request Accounting services on Condoly to explore your options.

 

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Discrimination in HOAs: A Claim That Must Be Taken Seriously

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Attorneys have seen an uptick in cases of alleged discrimiation in HOAs and condo associations. Complaints can become costly and stressful for an association.

Here is a summary of how a discrimination complaint is handled:

  • Individuals who believe they've faced discrimination by a community association can file a complaint with the Illinois Department of Human Rights (IDHR). This process is free, doesn't require a lawyer, and involves an investigator assigned to the case. The association receives the complaint by mail and, due to its corporate nature, must respond through an attorney.
  • The IDHR investigator then gathers information, interviews witnesses, and holds meetings. They then issue a finding stating if substantial evidence supports the discrimination claim. If evidence is lacking, the case is closed. If sufficient evidence exists, the case moves to the Human Rights Commission (HRC). The IDHR investigator doesn't determine guilt, just whether the claim requires further investigation.
  • The HRC process resembles a court case, with an assigned judge, discovery phases, and hearings. If no settlement is reached, the judge issues a recommended decision. Appeals are possible, leading to further court proceedings.

You can read examples of recent discrimination cases to better understand what a complaint may look like and its consequences here.

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KSN introduces Brainy Board

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KSN Law, a prominent community association law firm in the Chicagoland area, has launched Brainy Board, an on-demand streaming and educational resource for community association board members.

Learn more and create an account, here

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2023 First Installment Cook County Real Estate Tax Due March 1st

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The Cook County Treasurer has sent out the 2023 1st installment property tax bills, with payment due by March 1, 2024. These bills represent 55% of last year's total tax. Taxpayers are required to pay their tax bill regardless of any pending tax appeals. Any reductions in assessment resulting from a tax appeal will be reflected in the 2nd installment bill, which will be mailed later in the year. If a taxpayer's 1st installment tax bill is zero, it's likely due to the Assessor assigning a new PIN number, with the entire tax liability to be billed in the 2nd installment. Online payment and viewing options are available.

View and download your tax bill on the Cook County Treasurer's website.