What is The Community Foundation of Frederick County?
The Community Foundation of Frederick County is a community foundation established in 1986 to ensure financial support for nonprofit organizations primarily serving the Frederick County, Maryland area and to award educational scholarships to deserving Frederick County students. It is governed by twenty-four volunteers who sit on the Board of Trustees and is classified as a 501(c)(3) public charity under the provisions of the 1954 Internal Revenue Code, as amended.
What is a community foundation?
A community foundation is a union, or pool, of many gifts, many different estates or parts of estates, contributed for the most part by people of a particular community for the benefit of that community.
How can I learn more about the Community Foundation?
In addition to the information posted on the web site, printed materials are available at the Community Foundation and the President is available to answer questions. Many financial and legal advisors are also very familiar with the Community Foundation.
Where does the Community Foundation get its funds?
The Community Foundation receives its money from individuals, families, businesses, or organizations interested in providing financial support for the charitable causes of their choice. These outright gifts, planned gifts, bequests, trusts, annuities, or gifts of insurance, real estate, or securities make up the permanent funds of the Community Foundation, from which a portion of the fund is used to support the charitable cause for which the fund is intended.
Are gifts to the Community Foundation tax-deductible?
All gifts to the Community Foundation are tax-deductible to the furthest extent of charitable giving laws and regulations.
What is the Community Foundation's federal tax I.D. number?
How is the Community Foundation’s operating budget funded?
The Community Foundation receives many gifts from donors that are designated for operating expenses, including gifts received from members of The Widening Circles Society and Partners in Philanthropy. The Board of Trustees also solicits gifts to be placed in a special permanent fund called The Administrative Fund to support operations. At no time are gifts earmarked for funds used for operating purposes. Additionally, each permanent and pass through fund is assessed a small management fee to help offset the costs of administering the Community Foundation. Fees for all fund types, including scholarship, can be viewed here.
MAKING A GIFT
What types of gifts are accepted by the Community Foundation?
Gifts of cash and other assets—including stocks, bonds, real estate, and life insurance policies—are appreciated by the Community Foundation. All current assets must be able to be sold eventually so that the proceeds are invested with the other gifts in the fund, providing an annual funding stream to the charitable cause for which the fund is intended.
How are gifts made to the Community Foundation?
A donor may make an outright gift, planned gift, bequest, trusts, annuities, gifts of insurance, real estate, or securities of any size to the Community Foundation for the community's benefit and the gift will be used according to the donor’s instructions. Some donors designate specific organizations to receive their money. Others limit their gifts to specific areas of concern. Many donors provide undirected gifts to be used by the Community Foundation in responding to community needs as they arise.
I am interested in making a gift to the Community Foundation, but I want to receive supplemental income from my gift. Can the Community Foundation help me do this?
The Community Foundation has information on various giving vehicles, including charitable trusts and charitable gift annuities. Charitable trusts and gift annuities allow a donor to support favorite charitable causes, enjoy a tax deduction and still receive an income.
Will the Community Foundation serve as trustee for my charitable trust?
The Community Foundation has a "sister" nonprofit organization called The Community Foundation Holding Company, Inc., which may serve as the trustee for charitable trusts. It may be the sole trustee or co-trustee, depending on a donor’s intentions.
What is the minimum gift I need to create a charitable trust?
Usually, a minimum gift of $100,000 is needed to establish a charitable trust.
I am interested in supporting my favorite charities, but I also need to consider helping my grandchildren through college. Is there a way I can do both?
There are many techniques to provide charitable support and financial support to a donor’s heirs through various charitable trust vehicles. The Community Foundation is the perfect source to investigate options.
The federal government is going to take the majority of my estate in taxes anyway, isn’t it?
Maybe. For estate tax purposes, a donor may be worth more or less than imagined. Some charitable trusts lessen an estate’s tax liability and benefit a donor’s heirs as well. Donors should contact the Community Foundation to investigate ways to pass more of their estate along to their heirs with less of a tax burden through certain charitable giving techniques.
POOLED INCOME FUND
I have heard about the Community Foundation’s Pooled Income Fund. What is it?
The Community Foundation’s Pooled Income Fund is a trust that enables the individual donor, along with other donors, to "pool" their gifts in one trust. Donors receive the income generated by the Pooled Income Fund’s investments during their lifetime or during the lifetimes of their designated beneficiaries.
What happens to my portion of the Pooled Income Fund at my death?
At the time of death, a donor’s portion of the Pooled Income Fund passes to the Community Foundation’s funds, according to the donor’s instructions.
How much do I need for my first gift into the Pooled Income Fund?
An initial gift of $5,000 is needed to get started in the Pooled Income Fund.
WILLS AND BEQUESTS
Are charitable bequests in my will a good idea?
A charitable bequest would provide meaningful financial support to a donor’s favorite charitable cause, while reducing the size of the donor’s taxable estate.
I am interested in making a provision in my will to create a permanent fund. How do I do this?
Donors may include the Community Foundation in their will by making an outright bequest stating a specific dollar amount or percentage of the estate; donors may make the Community Foundation a beneficiary of a residual bequest in which the Community Foundation would be named to receive the remainder of their estate after their heirs have been provided for; or, donors might prefer a contingent bequest which provides for the Community Foundation only if others named in their will are not living at the time of the donor’s death. Whichever way a donor decides to include the Community Foundation in his or her will, the name of the fund to be created or added to, along with the purpose of the fund, should be clearly stated.
INVESTMENT PERFORMANCE AND MANAGEMENT
How are Community Foundation assets administered?
Professional investment managers safeguard and invest the Community Foundation's funds. An investment committee comprised of members of the Community Foundation's Board of Trustees and others with investment expertise sets the overall investment policy and monitors the performance of these managers. The list of the Community Foundation’s investment managers can be viewed by clicking here. The Community Foundation's accounts are audited annually by an independent auditor and are available for public review.
DISTRIBUTIONS AND GRANTS
How much of a permanent fund is distributed to the charitable beneficiary each year?
Permanent funds are either endowed or quasi-endowed. Endowments distribute net income plus appreciation annually, not to exceed 5 percent of the June 30 market value and never invading gift principal. Quasi-endowments spend 5 percent of the June 30 market value annually. In both cases, the funds always support the charitable cause for which the fund is intended.
Who decides how the Community Foundation's funds are distributed?
Distributions from the Community Foundation's funds are made by the Board of Trustees, according to the agreement made between the donor and the Community Foundation. All requests for grants from unrestricted funds are first reviewed by the Foundation's Grants Committee. Recommendations are then presented to the full Board for consideration and approval.
Where does the money go?
Distributions and grants are made to tax-exempt, nonprofit charitable organizations primarily serving Frederick County in the areas of education, the arts, health, social services, houses of worship, and the conservation and preservation of historical and cultural resources. Distributions from designated funds are sent annually to the charitable cause for which the fund was intended. Grant amounts from unrestricted funds vary depending upon the nature and needs of the organizations and the funds’ investment return. Scholarships are awarded annually through an application and review process with consideration of specific scholarship fund guidelines. Since its inception, the Community Foundation has distributed more than $42 million back to the community.
What special recognitions are available for donors to the Community Foundation?
Individuals who make deferred gifts through their will, life insurance policies or charitable trusts are given membership in the Community Foundation’s Cornerstone Society. Individuals and businesses who give $100 or more each year to the Community Foundation’s operating budget are included in The Widening Circles Society and Partners in Philanthropy. Additionally, donors who create permanent and pass through funds in their names enjoy the recognition that comes with having their name publicized during Community Foundation activities and within Community Foundation publications.
Are there any fees associated with creating a fund?
There are no fees to establish permanent or pass through funds with the Community Foundation.
- 312 East Church Street
- Frederick, MD 21701
- phone: 301-695-7660
- fax: 301-695-7775
- Directions to Our Office