Attorneys routinely receive and hold funds from clients or third parties for future use. The amount of money held and duration to be held determines whether the client’s money should be held in a client trust account or IOLTA trust account.
IOLTA trust accounts are intended for deposits small in amount or short-term in duration. IOLTA accounts may only be offered by qualified financial institutions that meet certain requirements and agree to offer favorable interest rates on all their IOLTA accounts.
Establishing an IOLTA Trust Account
When establishing an IOLTA trust account, there are a few tips to consider:
- Make sure your financial institution is an IOLTA Eligible Financial Institution.
- IOLTA eligible financial institutions are either headquartered in Nevada or have at least one physical branch in Nevada.
- Consider banking with a Leadership Institution that offers premium rates on all IOLTA accounts under deposit, which helps fund legal aid.
- When naming your account, the account title should list your firm name with a subtitle of IOLTA account, trust account or client funds account.
- The tax ID should be the tax ID for the Nevada Bar Foundation. Your financial institution should have it on record, or you may contact us.
- Each time you open a trust account, you must complete an Attorney Enrollment Form. Share a copy with your financial institution, send a copy to email@example.com and keep a copy for your records.
Annual Reporting Requirements
When submitting annual license fees and required disclosures to the State Bar of Nevada, all attorneys must also verify and report that their current IOLTA trust accounts are compliant with Supreme Court Rule 217. This means IOLTA trust funds must be in a participating financial institution.
All a lawyer is required to do to be compliant with the rule is:
- Place IOLTA account(s) only with a participating financial institution as verified by this list;
- Report that information on the member dues statement; or
- Claim a waiver only if the lawyer does not have a participating financial institution within 20 miles by checking the exemption box in the SCR 78 disclosure section of mandatory disclosures and hand writing the word “rural.”
The State Bar of Nevada has resources available to assist you.
Financial institution, interest rates and related inquiries: contact Brad Lewis, Access to Justice Commission Director at (702) 317-1409 or firstname.lastname@example.org.
Account set-up, maintenance, transfer, dissolution or ethics questions: contact the State Bar of Nevada’s Ethics Hotline at (702) 382-2200.
Trust Accounting in Nevada publication: Free download.
Information about the IOLTA program
Current text of Rule 217 effective September 5, 2019.
Supreme Court Rule 217 for Interest on Lawyer Trust Accounts (IOLTA) accounts require Nevada lawyers to create or maintain their IOLTA accounts ONLY at financial institutions which, in addition to other minimum qualifications in SCR 217 and SCR 78, offer interest rates under one of the three indices set forth in SCR 217, subsection 2. Funds arising from a Nevada matter must be kept in an approved financial institution in Nevada.
SCR 217 continues to define IOLTA (trust) accounts as those accounts set up by a Nevada attorney to hold clients’ funds which are nominal in size or are to be held for a short period of time.
Lawyers may maintain dedicated trust accounts for other than nominal or short-term funds, without interest or with interest to inure to the benefit of the client only, in any bank approved under SCR 78 for non-IOLTA trust funds.
Nevada Supports Community Reinvestment Act (CRA) Credit for IOLTA
Bank regulators in some regions award CRA credit for IOLTA, but not in all regions, including Nevada. The Nevada Supreme Court Access to Justice Commission and Nevada Bar Foundation (NBF) support CRA credit being awarded for IOLTA under the Community Service provision due to the instrumental role IOLTA plays in investing in low to moderate income (LMI) communities. Through the National Association of IOLTA Programs (NAIP) and on its own, the NBF has signed on to or written letters in support of CRA.