What are The Differences Between a HOA and a POA in Michigan

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What are the Charter Differences Between an HOA (Home Owners Assn.) and a POA (Property Owners Association?

A Property Owner Association (POA) and a Home Owner Association (HOA) are essentially identical entities and the only real difference is that an HOA requires actual homes to be on the sites; whereas a POA means anyone who owns a lot in the community is a member.

This is frequently an issue when the developer is in control of these associations and they have not turned them over to the owners as the developer can control and charge all types of fees that can be unfair to the other owners, but unfortunately, this is the right of the party that is in control. Source: http://www.justanswer.com/real-estate-law/5sbh3-legal-differences-hoa-poa.html

HOA VS. POA – WHAT’S THE DIFFERENCE?

(HOAs) and property owners associations (POAs) are easy to confuse because they are similar in nature. If you are considering starting one, but don’t know which to choose, check out these three facts that will help you understand the difference.

1) POAs Are More About the Property

a) To start an HOA within a neighborhood, you need to actually have homes or condos (or other dwelling units). The homeowners become members of the association and work together to make the neighborhood better.

b) On the other hand, POAs are more about the property. You can have a POA that is nothing but empty lots. In this instance, it’s the property owners who become members of the association. HOAs can be found in just about any neighborhood from urban to suburban, but POAs are often started around a landmark, such as a lake or a golf course, in hopes that people will buy the land for its location.

HOAs and POAs Can Be Very Similar

HOAs always rely on a board, and a list of rules and regulations that specify how the neighborhood is run, and homeowners must follow the guidelines. They usually have to pay monthly fees and get approval for many decisions, such as exterior paint color.

Not all POAs have rules and regulations the way HOAs do, but in other cases, a POA may be run almost exactly like an HOA with rules and fees. It varies from POA to POA.

c) HOAs are all about the neighborhood, which is why they have rules and regulations. The goal of the HOA is to create a pleasant and inviting neighborhood that people want to move to. The HOA wants to encourage people to move into the neighborhood, but they aren’t too worried about the real estate market outside of their neighborhood.

d) A POA, however, looks at the larger scale. They’ll often offer networking and other opportunities in an effort to boost and support the local real estate industry and other business entities. A POA can consist of homeowners, property managers or business owners.
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Both HOAs and POAs can create pleasant and enjoyable places to live.

e) For neighborhoods with actual dwellings, an HOA is a great choice;
f) But for areas with many empty lots, a POA is the better choice.

In the past a nonprofit corporation is formed under the Michigan Nonprofit Corporation Act. Some purposes for which nonprofit corporations are commonly formed are those involving religious, educational and charitable activities.

The Michigan Department of Treasury no longer has an application process for tax exemption from Michigan Sales and Use Tax for nonprofit organizations. Organizations exempted by statute, organizations granted exemption from Federal income tax under the Internal Revenue Code section 501(c)(3) or 501(c)(4) or organizations that had previously received an exemption letter from the Michigan Dept. of Treasury are entitled to sales and use tax exemption. A copy of the federal exemption letter or a letter previously issued by the Michigan Dept. of Treasury must accompany a completed Michigan Sales and Use Tax Certificate of Exemption, form 3372.

Source: https://associationvoice.wordpress.com/2016/01/21/hoa-vs-poa-whats-the-difference

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Tom

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