Charities report significant delays in receiving bequests from deceased donors' retirement accounts, as financial firms require lengthy verification processes and sensitive personal information before releasing funds. The issue has prompted six states to pass legislation requiring timely fund release, with California set to become the seventh, as experts warn the problem will intensify during the anticipated wealth transfer boom.
Charities report that financial firms are delaying the distribution of inherited IRAs and retirement accounts designated for nonprofits, sometimes for months or years, by requiring new accounts and sensitive personal information. The delays prevent charities from using intended donations for their missions, prompting six states to pass legislation requiring timely fund releases, with California expected to follow.