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Older adults with cognitive impairments often have difficulty performing instrumental activities of daily living (IADLs). Prompting technologies have gained popularity over the last decade and have the potential to assist these individuals with IADLs in order to live independently. Although prompting techniques are routinely used by caregivers and health care providers to aid individuals with cognitive impairment in maintaining their independence with everyday activities, there is no clear consensus or gold standard regarding prompt content, method of instruction, timing of delivery, or interface of prompt delivery in the gerontology or technology literatures. In this paper, we demonstrate how cognitive rehabilitation principles can inform and advance the development of more effective assistive prompting technologies that could be employed in smart environments. We first describe cognitive rehabilitation theory (CRT) and show how it provides a useful theoretical foundation for guiding the development of assistive technologies for IADL completion. We then use the CRT framework to critically review existing smart prompting technologies to answer questions that will be integral to advancing development of effective smart prompting technologies. Finally, we raise questions for future exploration as well as challenges and suggestions for future directions in this area of research.