Uncovering the Mystery of IOLTA Accounts
February 14, 2023
Uncovering the Mystery of IOLTA Accounts

IOLTA Accounts are trust accounts that collect interest and are used to provide free or low-cost civil legal services. Operating accounts and trust accounts are the main difference between a law practice and other businesses. Retainers must go into the trust account, fees come out of the operating account, and money is transferred from the trust account to the operating account when it is earned. Proper record keeping is necessary and a three-way reconciliation report is usually required. Funds should not be used to pay operating expenses and all unclear transactions should be handled according to state guidelines. The book balance, bank balance, and balance by matter should all match up.

“If you follow these rules, this will minimize the risk of commingling funds and you’re losing your license.”

In this episode, you will learn the following:

  1. What are the general rules that apply to an IOLTA account and how can law firm owners understand this concept without difficulty?
  2. How should law firms handle retainers properly and what are the record-keeping requirements for IOLTA accounts?
  3. How can law firms use CosmoLex to track IOLTA account funds and prevent commingling of funds?

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About Jayden

Jayden was not always the financial guru that he is today. Growing up in a household just shy of the federal poverty line in Prince George’s County, Maryland, he knew the importance of money management but didn’t have the tools to create the financial stability he so desperately craved. After graduating Towson University with a B.S in Accounting and incurring a large amount of debt, Jayden was determined to make a change.

With a little hard work, and A LOT of sacrifice, Jayden became independent, gained professional growth as an accountant at a small CPA firm in Atlanta, and became a Certified Public Accountant. Over the next years, he’s worked with clients in just about every industry — helping them not only expand their financial portfolios, but to create plans that ensure financial sustainability and minimize taxability.

As a CPA, Jayden’s goal is to help entrepreneurs like himself gain independence and create a unique action plan to bring more to their bottom line while paying less in taxes. Invest in yourself and start working with Jayden TODAY!

Jayden’s Website/Links

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