HOA Reserve Fund Compliance in Indiana: What Volunteer Boards Need to Know

Indiana’s absence of an explicit reserve study mandate sometimes creates a false sense of security for volunteer boards. IC 32-25.5 and IC 32-25 do not prescribe how to fund reserves, but they impose fiduciary duties with real consequences in litigation. When an Indiana HOA board allows common elements to deteriorate because reserves were never set aside and unit owners face a large special assessment, a court asks whether the board acted in the best interest of the association. The answer depends on whether the board had a documented plan.

Indianapolis is the dominant HOA market in Indiana, with substantial planned community development in Hamilton, Hendricks, and Johnson counties. These communities often have extensive amenity packages — pools, clubhouses, trails — that represent significant future capital expenditures. South Bend’s condo market, driven partly by proximity to the University of Notre Dame, adds complexity because condo associations face both private CC&R reserve requirements and the general fiduciary standard of IC 32-25.

BoardStack was built for boards in states like Indiana, where the law provides no compliance checklist but holds boards to a standard of care. The platform enforces account separation at the software level so reserves are never commingled with operating funds, and it gives boards a clear record of capital planning decisions that serves as evidence of good-faith fiduciary conduct.