Law Firm Bookkeeping Services
LAW FIRM BOOKKEEPING THAT KEEPS YOU OFF THE DISCIPLINARY BOARD
An IOLTA mistake doesn't cost you a penalty. It costs you your law license. We do bookkeeping for solo attorneys and law firms that need three-way trust account reconciliation, client ledger separation, retainer tracking, and the audit trail Pennsylvania Rule of Professional Conduct 1.15 requires. Pittsburgh-based, Cranberry Township team. We're not a CPA firm so we don't compete with your accountant. We're the bookkeepers who keep your books clean enough that the PA Disciplinary Board never has anything to ask about.
Deliverables
WHAT YOU GET
The Process
HOW IT WORKS
Free IOLTA Audit
Send us read-only access to your trust account, operating account, and current QuickBooks file (or whatever system you're using). Within 5 business days we deliver a written audit: Are you in compliance with PA Rule 1.15? Are client ledgers properly separated? Is there commingling? Are retainers being tracked correctly? Free. No obligation. If we find serious issues, we tell you straight up. Most law firms have at least minor issues. Some have major ones.
Cleanup if Needed
If your IOLTA reconciliation hasn't been done correctly (or hasn't been done at all), we fix it before going on a monthly plan. Cleanup is a flat fee based on scope. Could be 6 weeks of work for a solo who's never reconciled, could be 3 days for a small firm whose previous bookkeeper just missed a few months. You'll know the cost before we start.
Monthly Three-Way Reconciliation
Every month we reconcile your IOLTA bank statement against your client ledger total, then both against your QuickBooks general ledger. PA requires the three to match exactly. We deliver the reconciliation report by the 15th of the following month. If anything doesn't tie, we flag it before it becomes a problem.
Year-End and Tax Coordination
We hand your CPA tax-ready financials in early January. Year-end adjustments are already made. 1099s are already prepped. PA-20S/PA-65 information returns are already organized. Your CPA files. You don't have to be the middleman between bookkeeping and tax filing because we talk to them directly.
Ready to hand off your books?
One call. We'll figure out exactly what you need and what it costs.
The Impact
WHY IT MATTERS
Law firm bookkeeping is different from regular small business bookkeeping for one critical reason: you have a trust account. The IOLTA (Interest on Lawyers' Trust Accounts) holds money that belongs to clients, not to the firm. Pennsylvania Rule of Professional Conduct 1.15 governs how you must handle these funds, and the consequences for getting it wrong aren't tax penalties. They're disciplinary action. The PA Disciplinary Board can and does suspend or disbar attorneys for trust account violations. The most common violations we see when auditing new law firm clients in Pittsburgh: IOLTA and operating account commingling (depositing earned fees into the IOLTA, or paying operating expenses out of the IOLTA), failure to maintain individual client ledgers, retainer tracking that doesn't properly distinguish earned from unearned fees, and three-way reconciliation that hasn't been done correctly (or sometimes hasn't been done at all). PA Rule 1.15(d) requires that the bank statement balance, the client ledger total, and the general ledger balance all match every month. If they don't match, it's a red flag. If they're off by even a small amount over multiple months, the Disciplinary Board sees a pattern. Here's what law firm bookkeeping has looked like for some Pittsburgh-area firms we've worked with. A solo personal injury attorney in downtown Pittsburgh came to us after his bookkeeper of 4 years left abruptly. The bookkeeper had been doing tax prep, but had never done a three-way IOLTA reconciliation. The trust account had $480,000 in client funds across 47 active matters and the attorney had no idea if it was reconciled correctly. We rebuilt 18 months of trust account history from bank statements and case files. Found a $2,300 discrepancy from 14 months earlier (a deposit had been miscoded). The attorney had self-funded the discrepancy out of operating, which is technically allowed but had to be documented. We documented the entire history, set up proper three-way reconciliation going forward, and the attorney now sleeps at night. A 4-attorney family law firm in the South Hills was using a national online bookkeeping service that didn't understand IOLTA. The service was treating retainer deposits as income (they're not, they're a trust liability) and was reconciling the IOLTA to the bank statement but not to the client ledger total. The firm's accountant had been catching the income recognition issue at year-end, but the trust ledger was never properly maintained. We took over, separated all 90+ client ledgers from the previous 24 months, set up proper three-way reconciliation, and found one client whose trust balance was $400 less than it should have been. The firm replaced the $400 from operating, documented the correction, and now has a clean audit trail. A 12-attorney litigation boutique in Squirrel Hill had been doing things mostly correctly but had grown past the bookkeeper they hired when they were 3 attorneys. The bookkeeper was overwhelmed. Reconciliations were running 6 weeks behind. Cost advances (depositions, expert witness retainers, filing fees) weren't being properly classified as hard costs (deductible when paid) versus soft costs (capitalized and recovered from settlements). We took over the bookkeeping, caught up the reconciliation backlog in 4 weeks, set up automated cost advance tracking that ties each cost to a specific matter, and the firm's CPA now spends about 60 percent less time on tax prep. The firm also captured $24,000 in additional deductible hard costs that had been improperly classified as soft costs the previous tax year. Beyond IOLTA, law firm bookkeeping has other quirks that general bookkeepers miss. Client cost advances should be tracked per matter so they can be properly billed back to clients (or written off if uncollectable). Settlement disbursements need detailed audit trails because clients have the right to request an accounting. Partnership and PC distributions need to be tracked separately from W-2 compensation. Continuing legal education (CLE) credits, bar dues, malpractice insurance, and law library subscriptions are all deductible but need to be separately categorized for proper tax treatment. PA Department of Revenue treats law firms as professional service businesses, but Allegheny County and Pittsburgh have additional local tax requirements that many law firms forget. We track all of this in QuickBooks Online with custom fields for matter numbers, cost types, and client identifiers. Pittsburgh service area covers the full greater metro: downtown Pittsburgh, Squirrel Hill, North Hills, South Hills, Mount Lebanon, Bethel Park, Moon Township, Robinson Township, Fox Chapel, McCandless, Ross Township, Cranberry Township, Wexford, Mars, Warrendale, Butler, Greensburg, and Washington. We work with PA-licensed law firms anywhere in the state remotely. In-person meetings happen at our Cranberry Township office or your firm if you're within 30 minutes. Every law firm engagement is delivered by or under the review of a Certified QuickBooks ProAdvisor with specific experience in trust accounting. We are not licensed to practice law and we are not a CPA firm. Our role is bookkeeping. Your CPA files your taxes. Your bar association answers ethics questions. Your malpractice insurer handles claims. We do the books that all three of them rely on.
Best Fit
IS THIS RIGHT FOR YOU?
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Common Questions
FREQUENTLY ASKED QUESTIONS
Yes. PA Rule 1.15 governs how attorneys must handle client funds, including the requirement that bank statement, client ledger total, and general ledger all reconcile every month (three-way reconciliation). We've handled IOLTA bookkeeping for solo personal injury, family law, criminal defense, real estate, estate planning, and litigation firms across the Pittsburgh metro. We are not licensed to practice law, but we know how to keep books that satisfy Rule 1.15(d).
Three-way reconciliation means three numbers must match every month: (1) the bank statement balance for your IOLTA account, (2) the total of all individual client ledger balances, and (3) the IOLTA balance in your general ledger. PA Rule 1.15(d) requires this reconciliation be performed at least quarterly. We do it monthly because monthly catches problems before they compound. If any of the three numbers don't match, there's commingling, missed deposits, miscoded transactions, or worse.
Plans for law firms start at $599 per month (Growth plan). Solos with low transaction volume sometimes fit on the $399 Essentials plan if their IOLTA is simple. Multi-attorney firms with high matter volume typically run $799 to $1,499 per month depending on complexity. Cleanup work (if your previous IOLTA reconciliation was done incorrectly) is a separate flat fee based on scope, quoted before any work starts.
No. We do bookkeeping. Your CPA, EA, or in-house tax attorney files. We coordinate directly with whichever tax preparer you have to deliver tax-ready financials, prepped 1099s, and PA-20S/PA-65 information return support for partnerships and PCs.
You give us read-only access to your IOLTA bank account, your operating account, and your current QuickBooks file (or any other system you use). Within 5 business days we deliver a written audit: Are your IOLTA and operating accounts properly separated? Is three-way reconciliation being done? Are individual client ledgers being maintained? Are retainers being tracked correctly? If we find issues, we tell you what they are and what it would cost to fix them. If your books are clean, we tell you that too. No charge.
Yes. Most cleanup engagements take 3 to 8 weeks depending on transaction volume. We rebuild client ledgers from settlement statements, retainer agreements, and bank records. We document every adjustment so if the PA Disciplinary Board ever asks, you have a complete audit trail showing how each correction was made and when.
Yes. We prep firms for both random audits (PA Disciplinary Board does about 600 per year) and formal complaint investigations. We organize your IOLTA documentation, verify three-way reconciliation is complete and correct for the relevant period, prepare client ledger summaries, and produce the audit trail the Board investigator will request. We've delivered audit-ready documentation for several Pittsburgh-area firms.
Yes. Litigation firms in particular need to track client cost advances carefully. Hard costs (filing fees, deposition transcripts, expert witness retainers paid directly to a third party) are deductible when paid. Soft costs (in-house copying, internal time spent on a matter) are capitalized and recovered from settlement. Misclassifying these is a tax mistake we see often. We set up custom QuickBooks fields that track each cost by matter and cost type so your CPA can apply correct tax treatment.
Retainer agreements vary. Some retainers are evergreen (replenished monthly, earned as work is done). Others are one-time deposits drawn down as fees are earned. We track each retainer's structure separately, post earned fees from trust to operating only as the work is actually performed, and produce client trust account statements monthly so you can review or send to the client on request.
Yes. We handle partner capital accounts, profit distribution waterfalls, guaranteed payments, K-1 prep for the firm's CPA, and the bookkeeping side of partner compensation. Whether your firm is structured as a PA general partnership, PA LLP, PC, or PA LLC, we set up QuickBooks to match your partnership agreement so distributions flow correctly.
Bookkeeper. We are not a CPA firm and we don't try to be. We're Certified QuickBooks ProAdvisors who specialize in keeping books clean. CPAs file taxes and provide attestation services we cannot. The right setup for most law firms is a great bookkeeper plus a great CPA. They're different jobs.
Allegheny County (downtown Pittsburgh, Squirrel Hill, Strip District, Lawrenceville, Oakland, Mount Lebanon, Bethel Park, Moon Township, Robinson Township, Fox Chapel, McCandless, Ross Township, Shaler), Butler County (Cranberry Township, Wexford, Mars, Warrendale, Seven Fields, Butler, Gibsonia), Westmoreland County (Greensburg, Murrysville, Monroeville), Washington County (Canonsburg, Peters Township, Washington), and parts of Beaver County. Remote work covers law firms anywhere in PA with a PA Bar license.
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