There has been a lot of buzz in the fundraising world about qualified charitable contributions from IRAs. Many donors of a certain age are now aware that they can give directly from their IRAs without paying taxes on the withdrawal.
Donors can also designate a charity as the beneficiary of their retirement plan. The process is similar to naming a beneficiary of a life insurance policy (which can also be given to charity). While family members are often in a position to begin the process of receiving funds as a named beneficiary, charities are at a disadvantage: They often must rely on family members, executors, attorneys or the financial institution to notify them of the gift.
Retirement plan administrators, in all but a handful of states, are not legally required to notify beneficiaries. (The same holds true for life insurance companies.) Unfortunately, the financial incentive for the company to hold onto the money is strong, and some have created unfair hurdles for charities to overcome to receive the gift their donor intended.
Unnecessary Roadblocks
Some financial institutions expect charities to open an account and provide extensive personal information of either the CFO or board members to receive the funds. This process can take months if not years. Meanwhile, financial institutions profit from these delays by holding onto the assets and collecting fees.
Birth of the RIFT Project
That’s where the RIFT (Release IRA Funds Timely) Project comes in. The RIFT Project is the brainchild of estate planning attorney Johni Hays, JD, FCEP, and executive vice president of Thompson & Associates.
RIFT offers resources, such as a database of IRA custodians and their requirements, guidance to seek exceptions, as well as sample letters that charities can use. RIFT also advocates for change at the state level and invites fundraisers, particularly those who work in estate settlement, to join the RIFT Advocates Working Group which meets monthly. The National Association of Charitable Gift Planners is working on a federal solution.
As of June 16, 2026, six states (Iowa, Illinois, Indiana, Tennessee, Colorado and Nebraska) have passed laws to prohibit financial institutions from demanding excessive personal information from charities and requiring them to pay claims promptly. To simply and accelerate the process, RIFT has developed a model law originally based on the Iowa law that other states can adopt.
Monitoring the RIFT
Sharpe experts have been watching this issue closely and communicating about the RIFT Project with nonprofit colleagues, including an article in our Sharpe Insights Newsletter and an episode of the Sharpe Insights Podcast featuring Johni Hays.
If you would like to share your experience, please email us at info@sharpegroup.org.
Teri Sullivan is vice president of marketing for Sharpe Group and serves as co-producer of the podcast Sharpe Insights: Conversations With Your Planned Giving Experts. You can connect with Teri via email or on LinkedIn.
