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Alert: Annual Reports Required for All PA Non-Profit Community Associations Beginning in 2025

EDITOR’S NOTE: This blog originally appeared on Hoffman Law LLC’s blog and is reprinted by permission of the author, Ed Hoffman, Jr., Esq., CCAL. Visit the Hoffman Law LLC blog here.

Those of you who follow Hoffman Law LLC may remember our post from a few years back reminding you to get your Decennial (i.e., 10 year) Reports filed with the PA Department of State to save your name:
https://hoffmanhoalaw.com/save-your-name-has-your-non-profit-community-association-filed-its-decennial-report/

NEWS ALERT – THIS HAS ALL CHANGED – EFFECTIVE BEGINNING IN 2025 AN ANNUAL REPORT IS REQUIRED! What does this mean to your Community Association? The Pennsylvania Department of State has provided the following guidance (in pertinent part(s)):

On November 3, 2022, Governor Wolf signed into law Act 122 of 2022, and the law became effective on January 2, 2023. Among the many changes made by this legislation, Act 122 created an annual report requirement (like that imposed by most states) for domestic and foreign filing associations. The long-time decennial report requirement for these associations has been repealed. The new annual report filing is required for many types of entities, including domestic nonprofit corporations (which includes many Community Associations).

Here is the good news – we have some time. The annual report requirement begins in calendar year 2025. Similar again to other states, failure to file the annual report will subject a nonprofit corporation Community Association to administrative dissolution/termination/cancellation and loss of the protection of its name.

The annual report will include the following:
• Community Association Name
• Jurisdiction of formation
• Registered office address
• Name of at least one director, board member, etc., depending on type of Ass’n
• Names and titles of the principal officers, if any
• Address of the principal office
• Entity number issued by the Pennsylvania Department of State

The fee for the new annual report is $0 for nonprofit corporations (which includes many Community Associations) and the deadline for filing the annual report is June 30 of each year.

The Department of State will mail notice to the registered office address of each nonprofit corporation Community Association required to make an annual report at least two months prior to the respective deadline, reminding it of the need to make an annual report. It is critical that affected nonprofit corporation Community Associations keep all information on file with the Department up-to-date, particularly registered office address, to ensure that they receive notice of how and when to make annual reports. Nonprofit corporation Community Associations also have the ability to provide emails for additional notifications. However, failure by the Department to deliver notice to any party, or failure by any party to receive notice, of an annual report filing requirement does not relieve the nonprofit corporation Community Association of the obligation to make the annual report filing.

The new annual report requirement is a significant change for Pennsylvania. Therefore, Act 122 requires that the Department provide nonprofit corporation Community Associations with a transition period before imposing any dissolution/termination/cancellation for failure to file annual reports. Beginning with annual reports due in 2027, nonprofit corporation Community Associations that fail to file annual reports in the 2027 calendar year will be subject to administrative dissolution/termination/cancellation six months after the due date of the annual report.

Should a nonprofit corporation Community Association discover that it has failed to make a required annual report and has been dissolved or terminated, it has the opportunity for reinstatement, with no limitation on the period of time for such reinstatement. Such reinstatement must be accompanied by the application for reinstatement fee and a fee for each delinquent annual report that was not previously paid (if a fee is then applicable, as it is currently listed to be $0).

During the time of administrative dissolution/termination/cancellation, the nonprofit corporation Community Association’s name is made available to any other entities. If another entity has taken the name of the existing (senior/original) nonprofit corporation Community Association seeking reinstatement, the other nonprofit corporation Community Association that has appropriated the name may keep the name and the existing (senior/original) nonprofit corporation Community Association seeking reinstatement must choose a new name.

IT IS THEREFORE CRITICAL TO FILE AN ANNUAL REPORT BEGINNING IN 2025 TO CONTINUE TO PREVENT DISSOLUTION/TERMINATION/CANCELLATION OF YOUR COMMUNITY ASSOCIATION … AND TO CONTINUE TO SAVE YOUR NAME!

Source for this Blog Post: https://www.dos.pa.gov/BusinessCharities/Business/Resources/Pages/Annual-Reports.aspx

ABOUT THE AUTHOR
Edward Hoffman, Jr., Esq., CCAL, is the Founder and Managing Member of Hoffman Law LLC, a community association law firm with multiple offices in Pennsylvania. Ed is a Fellow of the College of Community Association Lawyers (CCAL), the current Chair of CAI’s Pennsylvania Legislative Action Committee, and is a member of the chapter’s Pocono Mountains Regional Council. Ed is a prolific author and well-received speaker on association topics and has been published and presented on association law and related topics both regionally and nationally, including nine articles published in CAI’s national flagship magazine, Common Ground, and having presented nine times at CAI’s national Community Association Law Seminar. Ed is also the founder and host of the Association Nation® Video Podcast. Find Hoffman Law LLC here: www.hoffmanhoalaw.com. Blog: http://pahoalaw.blog.

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