Frequently Asked Questions

IOLTA FAQS

What is IOLTA?
"Interest on Lawyers' Trust Accounts," or IOLTA, is a program mandated by the Supreme Judicial Court. It requires lawyers and law firms to establish interest-bearing accounts for client deposits which are nominal in amount or expected to be short-term. First approved as a voluntary program in 1985, the SJC adopted a comprehensive IOLTA program in 1989 requiring all eligible lawyers to participate.
How does it work?
Can lawyers continue to invest client fund monies on behalf of clients?
What guidelines do we follow in dealing with client funds accounts?
What do I do if my bank does not offer IOLTA accounts?
Who pays taxes on the interest earned on IOLTA accounts?
Is this program unique to Massachusetts?
Not at all. The first IOLTA program in America was established in Florida in 1981. Since then, all 50 states and the District of Columbia have adopted IOLTA programs.
Where does the money go?
Does IOLTA place any added administrative burdens on lawyers?
What obligations do financial institutions have regarding IOLTA?
Must all lawyers establish IOLTA accounts?
Must clients receive notice of our enrollment in the IOLTA program?

MAIOLTA.ORG

The Massachusetts IOLTA Committee
Seven Winthrop Square, 3rd Floor 
Boston, MA 02110-1245

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