Questions and Answers about CMF Giving (February 2024)
It has come to our attention that contributions from your Individual Retirement Account (IRA) to Carolina Meadows Foundation (CMF) cannot be made directly from your Qualified Charitable Distribution (QCD) or Required Minimum Distribution (RMD). This is information we just learned from communication with Fidelity. We wanted to bring it to your attention so you can consult with your advisors. Please note that this does not change any other tax-exempt giving options to Carolina Meadows Foundation, Inc. This only affects gifts to CMF through QCD or RMDs.  Listed below are some questions and answers that may help clarify.

Is Carolina Meadows Foundation, Inc. (CMF) a 501(c)(3)? 
Yes, Carolina Meadows Foundation, Inc. has federal tax-exempt status under Internal Revenue Code 501(c)(3). Donors can deduct contributions they make to CMF under IRC Section 170. CMF is also qualified to receive tax deductible bequests, devises, and transfers. CMF is classified as a public charity (not a private foundation).

Why is Carolina Meadows Foundation, Inc. established as a Type II supporting organization?
CMF was legally established as a Type II charitable supporting organization under IRC Section 509(a)(3) because it is controlled in connection to Carolina Meadows, Inc.  CMF only exists to support Carolina Meadows, Inc. CMF meets all the requirements of a 501(c)(3) organization, plus additional requirements specific to supporting organizations in order to qualify for tax-exempt status.  IRC Section 509(a)(3) supporting organization status is a common structure for foundations that are a part of continuing care retirement community systems.

Is Carolina Meadows Foundation, Inc. eligible to receive qualified charitable distributions (QCD)? Unfortunately, as recently learned via statements received from Fidelity and specific investment institutions, there are a few charities which are not eligible to receive QCDs, including charitable organizations that carry out their tax-exempt purposes by supporting other exempt organizations, usually other public charities. The Carolina Meadows Foundation is classified by the IRS as a 509(a)(3) supporting organization since it supports Carolina Meadows, Inc. Distributions to a 509(a)(3) supporting organization from an IRA will not qualify as a qualified charitable distribution and cannot count towards your RMD.

What if I contributed from my IRA to CMF in 2023?
If your IRA financial organization made a QCD or RMD to Carolina Meadows Foundation, Inc for the 2023 Employee Success Fund and you would like to get an acknowledgement letter from Carolina Meadows Inc., we can do that for you. These funds flowed through CMI to reach employees and CMI can issue a letter for your taxes.

What if I want to make a donation from my IRA and have it count as a QCD in the future?  
In the future, Carolina Meadows, Inc. (CMI) (rather than Carolina Meadows Foundation) can receive a donation from your IRA, and it will count as a QCD and may count toward your RMD for that tax year, if designated by you to your financial institution. You can designate your gift (such as to the Employee Success Fund) and Carolina Meadows, Inc. will appropriately restrict that QCD or RMD for the purpose designated by you. Restricted gifts made to Carolina Meadows, Inc. from your IRA will be held by CMI and aggregated with the same restricted non-QCD/RMD gifts made to CMF to be used for the designated restricted purpose.  Unrestricted QCD or RMD gifts made to CMI can be transferred to CMF and will be appropriately controlled and designated by the CMF Board.

What if I have questions about my personal tax situation?
As always, we encourage you to consult with your tax or financial advisors about your unique situation to gather guidance on how to minimize your tax liability and maximize the impact of your gift. A tax advisor can help you determine if both your IRA and charity qualify for QCDs. We are glad to provide CMF’s IRS tax determination letter.