1/17/2024 0 Comments Definition of iota accountFormerly these types of funds were referred to as “short term” and “nominal” funds. Rule 1.15B rIllinois lawyers are required to deposit funds of clients and third persons into IOLTA accounts unless those funds can otherwise earn net income for the client or third person. Interest-bearing client trust accounts established to hold the funds of client, with the client receiving the interest.IOLTA accounts, with interest remitted to the Lawyers Trust Fund.There are only two types of client trust accounts permitted under the rule: Under Rule 1.15, which provides for the safekeeping of property belonging to clients and third persons, lawyers must deposit all funds belonging to clients and third persons into client trust accounts. (Learn more about Illinois’ legal aid system and about LTF.) IOLTA requirements In 2022 IOLTA revenues helped the Lawyers Trust Fund make grants to 48 non-profit organizations across Illinois, which provided assistance to low-income Illinoisans regarding more than 109,000 legal matters. Interest generated on IOLTA accounts is an important source of funding for civil legal aid in Illinois. Under Rule of Professional Conduct 1.15B, Illinois lawyers are required to deposit funds of clients and third persons into IOLTA accounts unless those funds can otherwise earn net income for the client or third person. An IOLTA account is a pooled, interest- or dividend-bearing business checking account (such as a NOW account) for the deposit of client funds which pays all interest earned to the Lawyers Trust Fund. “IOLTA” stands for Interest on Lawyer Trust Accounts. The rule change order issued by the Supreme Court is available here. Nonetheless, the basic requirements regarding safekeeping of property, lawyers’ use of IOLTA accounts, payment of comparable interest rates on IOLTA accounts, and management of unidentified funds in IOLTA accounts are fundamentally unchanged. These are the most comprehensive revisions to RPC 1.15 since the current rule took effect in 2011 and include significant changes to the organization of the rule’s provisions, including the adoption of new Rules 1.15A, 1.15B, and 1.15C. On March 1, the Illinois Supreme Court announced changes to Rules of Professional Conduct 1.5 and 1.15 that will take effect July 1, 2023. PRACTICE UPDATE: Revised Safekeeping Rules Take Effect July 1, 2023
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