Search the internet for “cemetery” and “friends of” and you will find a number of independent maintenance associations.  We’re not referring to Facebook groups that organize volunteer events for an abandoned cemetery, but rather we want to highlight those formal organizations established to provide continuing financial assistance to an active cemetery.

As a cemetery nears its capacity, revenues from lot sales and interment services will decline.  Most cemeteries are already experiencing revenue declines because of the public’s embrace of cremation.  Declining revenues require cuts to the cemetery’s maintenance budget.  This situation has led some of our cemetery clients to convert to tax exempt status so they may seek donations from prominent individuals with family buried in the cemetery.   However, caring families are frequently taking an independent route by forming their own maintenance association.

Established by descendants of cemetery lot owners, an independent maintenance association may have an agenda that differs from that of the cemetery board.  While the cemetery board may be focused on keeping the grass cut and the roads in repair, the independent maintenance association may want the chapel renovated, the mausoleum roof repaired or historic markers replaced.  Not wanting their donations diverted to general cemetery needs, the independent maintenance association retains control over its own budget or trust.  The association can also steer clear of trust distribution constraints that may be imposed by state law on the cemetery endowed care trust.

To achieve its own tax exempt status (so that donations are deductible), the independent maintenance association must qualify with the IRS as either a Section 501(c)(3) charity or a Section 501(c)(13) cemetery company.  Implicit in this approval is that association also be formed under state law as a company or association.   Costs will be incurred with both the formation of the company and the IRS filing.

The following hyperlink will take you to the Perservation and Enhancement Fund page of Mount Olivet Cemetery in Frederick, Maryland.  This page provides history of their ‘friends/preservation’ association and the challenges of preserving their garden cemetery.  The page provides a valuable marketing tool in seeking donations.

The independent maintenance association is not a friend that is available to the for-profit cemetery.  The tax exempt status precludes the association from providing maintenance assistance that is otherwise required from a for profit company.  For cemeteries with a mausoleum in need of repairs, we have seen the mausoleum being transferred to a new 501(c)(13) company.  Future crypt sales provide revenue for mausoleum repairs, and the independent maintenance association is then formed to help subsidize repairs and future upkeep.