diff --git a/changelogs/fragments/5549-lxd-project-sanity.yml b/changelogs/fragments/5549-lxd-project-sanity.yml
new file mode 100644
index 0000000000..0a5e328e1c
--- /dev/null
+++ b/changelogs/fragments/5549-lxd-project-sanity.yml
@@ -0,0 +1,2 @@
+minor_changes:
+  - lxd_project - refactored code out to module utils to clear sanity check (https://github.com/ansible-collections/community.general/pull/5549).
diff --git a/plugins/module_utils/lxd.py b/plugins/module_utils/lxd.py
index bdf026313a..007de4d8db 100644
--- a/plugins/module_utils/lxd.py
+++ b/plugins/module_utils/lxd.py
@@ -8,8 +8,10 @@ from __future__ import (absolute_import, division, print_function)
 __metaclass__ = type
 
 
+import os
 import socket
 import ssl
+import json
 
 from ansible.module_utils.urls import generic_urlparse
 from ansible.module_utils.six.moves.urllib.parse import urlparse
@@ -20,8 +22,6 @@ from ansible.module_utils.common.text.converters import to_text
 HTTPConnection = http_client.HTTPConnection
 HTTPSConnection = http_client.HTTPSConnection
 
-import json
-
 
 class UnixHTTPConnection(HTTPConnection):
     def __init__(self, path):
@@ -124,3 +124,11 @@ class LXDClient(object):
         if err is None:
             err = resp_json.get('error', None)
         return err
+
+
+def default_key_file():
+    return os.path.expanduser('~/.config/lxc/client.key')
+
+
+def default_cert_file():
+    return os.path.expanduser('~/.config/lxc/client.crt')
diff --git a/plugins/modules/lxd_project.py b/plugins/modules/lxd_project.py
index f0aa4058e7..ad6019c2ec 100644
--- a/plugins/modules/lxd_project.py
+++ b/plugins/modules/lxd_project.py
@@ -178,7 +178,9 @@ actions:
   sample: ["create"]
 '''
 
-from ansible_collections.community.general.plugins.module_utils.lxd import LXDClient, LXDClientException
+from ansible_collections.community.general.plugins.module_utils.lxd import (
+    LXDClient, LXDClientException, default_key_file, default_cert_file
+)
 from ansible.module_utils.basic import AnsibleModule
 import os
 
@@ -211,10 +213,10 @@ class LXDProjectManagement(object):
 
         self.key_file = self.module.params.get('client_key')
         if self.key_file is None:
-            self.key_file = os.path.expanduser('~/.config/lxc/client.key')
+            self.key_file = default_key_file()
         self.cert_file = self.module.params.get('client_cert')
         if self.cert_file is None:
-            self.cert_file = os.path.expanduser('~/.config/lxc/client.crt')
+            self.cert_file = default_cert_file()
         self.debug = self.module._verbosity >= 4
 
         try:
diff --git a/tests/sanity/ignore-2.11.txt b/tests/sanity/ignore-2.11.txt
index f8efbcfbee..5b8f3a4393 100644
--- a/tests/sanity/ignore-2.11.txt
+++ b/tests/sanity/ignore-2.11.txt
@@ -11,7 +11,6 @@ plugins/modules/gconftool2.py validate-modules:parameter-state-invalid-choice
 plugins/modules/iptables_state.py validate-modules:undocumented-parameter
 plugins/modules/jenkins_plugin.py use-argspec-type-path
 plugins/modules/lxc_container.py validate-modules:use-run-command-not-popen
-plugins/modules/lxd_project.py use-argspec-type-path # expanduser() applied to constants
 plugins/modules/manageiq_policies.py validate-modules:parameter-state-invalid-choice
 plugins/modules/manageiq_provider.py validate-modules:doc-choices-do-not-match-spec   # missing docs on suboptions
 plugins/modules/manageiq_provider.py validate-modules:doc-missing-type                # missing docs on suboptions
diff --git a/tests/sanity/ignore-2.12.txt b/tests/sanity/ignore-2.12.txt
index adb6d868a9..2ff7c01e0a 100644
--- a/tests/sanity/ignore-2.12.txt
+++ b/tests/sanity/ignore-2.12.txt
@@ -6,7 +6,6 @@ plugins/modules/gconftool2.py validate-modules:parameter-state-invalid-choice
 plugins/modules/iptables_state.py validate-modules:undocumented-parameter
 plugins/modules/jenkins_plugin.py use-argspec-type-path
 plugins/modules/lxc_container.py validate-modules:use-run-command-not-popen
-plugins/modules/lxd_project.py use-argspec-type-path # expanduser() applied to constants
 plugins/modules/manageiq_policies.py validate-modules:parameter-state-invalid-choice
 plugins/modules/manageiq_provider.py validate-modules:doc-choices-do-not-match-spec   # missing docs on suboptions
 plugins/modules/manageiq_provider.py validate-modules:doc-missing-type                # missing docs on suboptions
diff --git a/tests/sanity/ignore-2.13.txt b/tests/sanity/ignore-2.13.txt
index adb6d868a9..2ff7c01e0a 100644
--- a/tests/sanity/ignore-2.13.txt
+++ b/tests/sanity/ignore-2.13.txt
@@ -6,7 +6,6 @@ plugins/modules/gconftool2.py validate-modules:parameter-state-invalid-choice
 plugins/modules/iptables_state.py validate-modules:undocumented-parameter
 plugins/modules/jenkins_plugin.py use-argspec-type-path
 plugins/modules/lxc_container.py validate-modules:use-run-command-not-popen
-plugins/modules/lxd_project.py use-argspec-type-path # expanduser() applied to constants
 plugins/modules/manageiq_policies.py validate-modules:parameter-state-invalid-choice
 plugins/modules/manageiq_provider.py validate-modules:doc-choices-do-not-match-spec   # missing docs on suboptions
 plugins/modules/manageiq_provider.py validate-modules:doc-missing-type                # missing docs on suboptions
diff --git a/tests/sanity/ignore-2.14.txt b/tests/sanity/ignore-2.14.txt
index d670fe2282..5cd667f8d7 100644
--- a/tests/sanity/ignore-2.14.txt
+++ b/tests/sanity/ignore-2.14.txt
@@ -7,7 +7,6 @@ plugins/modules/homectl.py import-3.11  # Uses deprecated stdlib library 'crypt'
 plugins/modules/iptables_state.py validate-modules:undocumented-parameter
 plugins/modules/jenkins_plugin.py use-argspec-type-path
 plugins/modules/lxc_container.py validate-modules:use-run-command-not-popen
-plugins/modules/lxd_project.py use-argspec-type-path # expanduser() applied to constants
 plugins/modules/manageiq_policies.py validate-modules:parameter-state-invalid-choice
 plugins/modules/manageiq_provider.py validate-modules:doc-choices-do-not-match-spec   # missing docs on suboptions
 plugins/modules/manageiq_provider.py validate-modules:doc-missing-type                # missing docs on suboptions
diff --git a/tests/sanity/ignore-2.15.txt b/tests/sanity/ignore-2.15.txt
index d670fe2282..5cd667f8d7 100644
--- a/tests/sanity/ignore-2.15.txt
+++ b/tests/sanity/ignore-2.15.txt
@@ -7,7 +7,6 @@ plugins/modules/homectl.py import-3.11  # Uses deprecated stdlib library 'crypt'
 plugins/modules/iptables_state.py validate-modules:undocumented-parameter
 plugins/modules/jenkins_plugin.py use-argspec-type-path
 plugins/modules/lxc_container.py validate-modules:use-run-command-not-popen
-plugins/modules/lxd_project.py use-argspec-type-path # expanduser() applied to constants
 plugins/modules/manageiq_policies.py validate-modules:parameter-state-invalid-choice
 plugins/modules/manageiq_provider.py validate-modules:doc-choices-do-not-match-spec   # missing docs on suboptions
 plugins/modules/manageiq_provider.py validate-modules:doc-missing-type                # missing docs on suboptions