IOLTA Accounts

If the billing program is tracking IOLTA activity and recording payments to the invoice it will usually insure that an individual client’s IOLTA balance is not overdrawn. If you are doing this in QuickBooks, you must personally do this as QuickBooks will not prevent over-drafting a particular client account.

That’s why the Vermont Bar Foundation encourages you to bank with our Prime Partner Leadership Institutions. If the above situations do not apply, please contact your financial institution to ensure accurate reporting in the future. Meanwhile, report that you have deposited your IOLTA-eligible trust funds in an interest-bearing account and list the account information.

IOLTA and Client Trust Accounts

Through the Texas IOLTA Program, attorneys voluntarily pooled the interest earned on trust accounts to provide civil legal services to the poor. The same year, the Court created the Texas Access to Justice Foundation, a nonprofit corporation, to administer the program, including the collection and granting of IOLTA funds. All service charges other than allowable reasonable service charges assessed against an IOLTA Account are the responsibility of and must be paid by the lawyer or law firm. These charges may be deducted from the firm’s operating account, billed to the firm, or deducted from funds maintained or deposited by the lawyer in the IOLTA account for that purpose. Business costs or costs billable to others are the responsibility of the law firm and should not be charged against client funds in the account or against the interest or the earnings credit of an IOLTA account.

One is to make sure a client’s balance is correct either specifically or as compared to our billing program and that we are not about to overdraw a client’s account. If you are linking QuickBooks to another program it is important to understand what functions will take place in each program. For IOLTA accounting, generally, printing of checks and bank reconciliation will occur in QuickBooks. This means that you will want to track IOLTA balances by client in both the billing program and QuickBooks to make sure that they are in agreement.

True trust accounting compliance

You’d need to move those funds into a business account first. Regardless of how your law firm does its accounting, the system that you use to keep track of an IOLTA account must conform to the principles of double-entry accounting. Whatever it is called, we need to make sure with the bank that the fee cannot be charged to that account. A separate operating account iolta account or credit card has to pay all fees so that the customer’s money is never touched. Protect your client’s information and firm’s data with industry-leading security methods and protocols. Massachusetts Rule of Professional Conduct 1.15 and the 2009 IOLTA Guidelinesprovide rules and guidance regarding the Massachusetts IOLTA program and IOLTA accounts.

It does offer integration with many of the top billing and practice management solutions, so it may be a good choice for accounting in that situation. If you are looking at QuickBooks integrating with your other programs, there are some questions you should ask. First, you want to find out what versions your program integrates with. This means desktop vs. QBO; Pro/Premier or Enterprise; and what year version if desktop. You also need to understand what the vendor means by integration.