Ms Smith told police the condition of the animals was “not appropriate”, but claimed another group would be collecting the animals.
Researchers said it was clear that the cruelty “didn’t happen overnight” and described babies as “so small” that they could escape through the metal of their housings.
“Some dishes were too big for these little bunnies to drink from and one nearly fell into the bowl while desperately trying to drink,” according to a warrant filed in Scott County.
The foundation, owned by Smith’s 18-year-old son Caleb, said in a statement Saturday that it was suspending all activities and would not accept any more rabbits or donations.
The charity also said it would not spend donors’ money on Ms. Smith’s legal fees.
The Animal Humane Society cares for about 200 rabbits discovered at the site.
Authorities were alerted after the barn owner checked the outhouse after she hadn’t heard from Mrs Smith for several days and found dozens of dead, sick and injured rabbits.
Smith’s son, Caleb, has received praise for his work for the nonprofit rabbit rescue organization that, according to its website, cares for and trains comfort rabbits.
He was featured in the media about the foundation and wrote a book that describes him as “a boy who changes the world through kindness, one bunny at a time”.
Ms Smith is due to appear in court on August 22. She faces four years behind bars and a £11,000 ($13,000) fine.