Bookkeeping for Legal
Bookkeeping for Law Firms
IOLTA trust account compliance. Statutory audit support. Practice management software handled.
- AIPB Certified
- QuickBooks ProAdvisor
- Xero Partner
- US-based team
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Client funds held in trust are the one account where a bookkeeping mistake stops being an accounting problem and becomes a bar complaint. Every state bar has its own IOLTA rules: three-way reconciliation between the bank statement, the trust ledger, and individual client balances, usually monthly, with records that need to survive review on short notice. A shortfall, even an accidental one caused by a bounced check or a misapplied deposit, is the kind of thing that ends careers.
We work with solo practitioners running a single trust account, small firms with several partners and a shared operating account, and firms managing dozens of active client matters at once. The complexity changes with size. The discipline does not: trust and operating accounts kept entirely separate, three-way reconciliation done every month whether or not anyone asks to see it, and practice management software like Clio, MyCase, or PracticePanther reconciled against the actual bank balance.
Once we're handling the reconciliation, the low-grade dread that lives around trust accounting starts to fade. No more wondering whether last month's reconciliation would actually hold up. No more scrambling before a random audit letter. What's left is the practice of law, with books that would pass review on the day they're requested, not the week after.
Where legal bookkeeping actually helps
- I'm not fully confident our three-way trust reconciliation would pass a state bar audit todayThree-way reconciliation, bank statement to trust ledger to client balances, done every month and documented in a form your bar examiner can follow.
- Client funds and firm funds have gotten mixed up more than once by accidentTrust and operating kept in fully separate accounts and ledgers, with transfers made only for earned fees and documented every time.
- Clio or MyCase shows one number and my bank shows anotherPractice management software reconciled against the actual bank balance monthly, so the two numbers agree instead of drifting apart.
- I have no real way to know if a client's trust balance has quietly gone negativePer-client trust balances tracked and flagged the moment one runs below zero, before it turns into a bar complaint.
- Year-end reporting to my accountant is always a scramble between trust records and operating recordsTrust and operating reported separately and cleanly, so your CPA or EA gets a year-end pack that doesn't need untangling first.
What's different about legal bookkeeping
- IOLTA trust account compliance to your state bar's specific rules
- Three-way reconciliation: bank statement, trust ledger, and client balances
- Trust and operating accounts kept fully separate, with earned-fee transfers documented
- Practice management software (Clio, MyCase, PracticePanther) reconciled to the bank
- Per-client trust balance tracking, flagged before it goes negative
- Statutory and state bar audit support, records ready before they're requested
Where law firm trust accounting usually goes wrong
Most firm files we take over share a handful of the same issues. Trust and operating funds comingled at some point, almost always by accident, a filing fee paid out of the wrong account or a deposit posted to the wrong client matter. Three-way reconciliation done sporadically instead of monthly, so small discrepancies compound quietly for months before anyone notices. Practice management software drifting from the actual bank balance because nobody's checking the two against each other on a schedule.
Each gets addressed at onboarding. Trust and operating move into cleanly separated accounts, with transfers documented the moment fees are actually earned. Three-way reconciliation becomes a monthly fixture, not an occasional catch-up project. Clio, MyCase, or PracticePanther gets reconciled against the bank balance every month, so the two numbers stay in sync.
From there, per-client balances get watched continuously rather than checked once a quarter. A balance drifting toward zero gets flagged immediately, while it's still a bookkeeping correction and not a professional responsibility problem. When a bar audit letter does arrive, the answer is already sitting in a folder, not scrambled together the night before.
"Trust account compliance is non-negotiable in this business. We needed someone who knew our state rules cold and could deliver the monthly reconciliation packs without us chasing. They have never been late once."
What's included
- IOLTA/trust account reconciliation on a monthly three-way basis
- Operating account bookkeeping, fully separate from trust
- Practice management software reconciliation (Clio, MyCase, PracticePanther)
- Per-client trust balance tracking
- Statutory and state bar audit-ready documentation
- Payroll for associates and staff, where applicable
- Monthly profit and loss by practice area, where tracked
- Year-end handover to your CPA or EA
Why law firms pick us
Trust reconciliation, three-way, every month
Bank statement, trust ledger, and client balances checked against each other monthly, documented in a form a bar examiner can follow.
Audit-ready before the letter arrives
The documentation exists every month, whether or not your bar has asked to see it. A request gets a same-day answer.
Practice management software reconciled to the bank
Clio, MyCase, PracticePanther, whatever you run, checked against your actual bank balance monthly so the numbers agree.
We understand the weight of client funds
Trust accounting mistakes carry professional consequences most bookkeeping mistakes don’t. We treat it that way.
Per-client balances tracked, never guessed
Every matter has its own trust balance, watched continuously, flagged the moment it drifts toward zero.
Clean handoff to your CPA or EA
Trust and operating reported separately, so your accountant gets a year-end pack that makes sense on the first read.
Get the trust ledger audit-ready
Tell us your state bar and how many active matters you're running. Quote in writing the same business day.
Three firm shapes
Single trust account, a steady caseload
One attorney, one trust account, a manageable number of active matters. Reconciliation has been done inconsistently between busy stretches, and the risk is starting to weigh on the practitioner.
What changes
- Monthly three-way reconciliation established
- Trust and operating fully separated
- Per-client balances tracked cleanly
- Audit-ready documentation from month one
How law firms typically handle trust accounting
Attorney / office manager Small firm, DIY trust | Generalist bookkeeper Not trust-specific | Trust-focused (us) IOLTA, three-way, audit-ready | |
|---|---|---|---|
Three-way reconciliation done monthly | Partial | Partial | Yes |
Trust and operating fully separated | Partial | Partial | Yes |
Practice management software reconciled to bank | No | Partial | Yes |
Per-client balances tracked continuously | Partial | Partial | Yes |
Audit-ready documentation maintained monthly | No | Partial | Yes |
Books reviewed by an AIPB-certified bookkeeper | No | No | Yes |
How we price legal bookkeeping
Legal bookkeeping pricing depends on active matter count, trust account transaction volume, and whether operating payroll for associates and staff is part of the scope. A solo practitioner with a single trust account and a multi-partner firm with dozens of open matters carry very different reconciliation loads.
Fill in the quote form, tell us your state bar and roughly how many active matters you handle, and we'll come back with a written number the same business day. Catch-up work on a trust account that's fallen behind on reconciliation is quoted separately.
Related industries
What clients say
"Trust account compliance is non-negotiable in this business. We needed someone who knew our state rules cold and could deliver the monthly reconciliation packs without us chasing. They have never been late once."
Legal bookkeeping FAQ
Two things to remember
Every account is reconciled and kept tax-ready by an AIPB-certified bookkeeper. Every account is run inside the US. Those two anchors shape how we handle compliance for law firms specifically.
Audit-ready every month.
Tell us your state bar and matter count. We'll quote your retainer the same day.