Indiana HOA Reserve Fund Calculator — IC 32-25.5-4-6 (Indiana Condominium Act) & IC 32-21-13 (Planned Community Act)

No. Indiana does NOT impose a mandatory reserve-study requirement under IC 32-25.5-4-6 (Indiana Condominium Act) or IC 32-21-13 (Planned Community Act). This contrasts with WUCIOA in Washington (RCW 64.90.530 requires associations with 50+ units to conduct a reserve study every three years) and Florida (Fla. Stat. Sec. 718.112 requires condominiums with more than 10 units to conduct a reserve study or vote to waive reserves). Indiana boards are required to maintain adequate reserves under IC 32-25.5-4-6, but the statute does not specify a methodology or minimum percentage. A reserve study is strongly recommended best practice even though not legally required.

IC 32-25.5-4-6 requires the board of directors of an Indiana condominium to maintain a reserve fund for the repair, replacement, and maintenance of the common elements. The amount of the reserve fund is at the board's discretion. The statute does not specify a minimum percentage of assessments to be contributed, a funding-ratio target, or a mandatory reserve-study cycle. The board has fiduciary discretion — and fiduciary responsibility — to set reserve contributions at a level that reasonably anticipates major capital expenditures. Boards that systematically underfund reserves may face liability if a major component fails and a large special assessment becomes necessary.

A funding ratio is the current reserve balance divided by the fully-funded target (total replacement cost) expressed as a percentage. Industry practice from the Community Associations Institute (CAI) generally classifies: 70%+ as adequately funded; 30–70% as underfunded (may require a special assessment when components fail); below 30% as critically underfunded (high special-assessment risk). Indiana lenders and title companies occasionally review reserve-fund health for condominium financing; a very low funding ratio can affect unit owners' ability to obtain conventional mortgages. FHA project approval for Indiana condominiums requires at least 10% of the annual budget allocated to reserves.

IC 32-25.5-4-6 does not authorize the board to waive reserve contributions — the statute creates an affirmative duty to maintain a reserve fund. However, because the amount is at board discretion and there is no statutory minimum, a board could theoretically adopt a budget with a very low (near-zero) reserve contribution. This would likely constitute a breach of fiduciary duty if challenged. Some Indiana condominium declarations specify a minimum reserve percentage (often 10% of the operating budget); if the declaration imposes a minimum, the board must meet it. Unlike Florida (which requires an owner vote to waive reserves), Indiana does not have a statutory waiver-vote procedure.

INDIANA (IC 32-25.5-4-6): Board must maintain adequate reserves; amount at discretion; no mandatory reserve study; no statutory minimum percentage. WASHINGTON WUCIOA (RCW 64.90.530): 50+ unit associations must conduct a reserve study every 3 years; annual budget must disclose reserve status. FLORIDA (Fla. Stat. Sec. 718.112): Condominiums with more than 10 units must conduct a reserve study (or vote to waive); specific line-item reserve accounts required for roof, painting, paving, and other specified items; reserves cannot be used for other purposes without an owner vote. Indiana's reserve regime is the least prescriptive of the three — boards have maximum flexibility but also maximum accountability.