Bookkeeping and Accounting for Personal Injury Law Firms

Personal injury practices run on a financial model unlike any other area of law. You advance case costs for months or years, get paid on contingency when a matter settles, and then have to distribute a single settlement check correctly among your client, medical providers, lienholders, referring attorneys, and your own operating account. Errors in that process can create serious problems for a firm. A&W Associates provides specialized bookkeeping for personal injury firms to help keep every dollar tracked, reconciled, and documented.

Settlement Disbursement Records

When a case settles, the funds belong in trust until they are properly disbursed. We help your team organize the figures for each closing statement, record every disbursement against the client’s trust ledger, and track amounts held for medical providers, lienholders, and other third-party claims until they are resolved. Your attorneys remain responsible for the closing statement and for deciding how settlement funds are distributed under the applicable rules. Our role is to keep the financial records accurate, complete, and ready for review.

Case Cost Advances and Matter-Level Tracking

Filing fees, expert witnesses, medical records, depositions, and investigators add up fast. We track advanced costs by matter so you have a clear view of your investment in each case, what is recoverable at settlement, and which cases are tying up the most capital. That visibility helps you decide which cases to take on and when to push for resolution.

Trust Accounting and Three-Way Reconciliation

Personal injury firms move large sums through their IOLTA and trust accounts. We perform monthly three-way reconciliations, comparing the bank statement, the trust account ledger, and the individual client ledgers, so discrepancies are identified and resolved promptly.

Managing Uneven Cash Flow

Contingency fee revenue arrives in waves. A strong month can be followed by a long dry spell. We give you clear monthly financial reports, cash flow forecasts, and visibility into your case pipeline so you can plan payroll, marketing spend, and lines of credit with confidence.

Referral Fees, Co-Counsel Splits, and 1099 Reporting

Fee-sharing arrangements with referring or co-counsel attorneys are governed by your fee agreements and the applicable bar rules, and they need to be recorded accurately. We track every split as documented and keep tax-ready records your CPA can use to determine and prepare any required 1099 filings.

What We Handle for Personal Injury Firms

Settlement disbursement tracking and closing statement support
Medical lien and subrogation payoff records
Case cost advances by matter
IOLTA and trust account reconciliation
Accounts payable and receivable
Payroll coordination
Monthly financial statements and cash flow reporting
Tax-ready books coordinated with your CPA

Why Personal Injury Attorneys Choose A&W Associates

Our team brings over 25 years of financial and accounting experience and specialized training in legal bookkeeping. You get a bookkeeping partner who understands contingency practices without the cost of a full-time in-house accountant. Contact us today to talk about your firm’s needs.

Personal Injury Bookkeeping in Major Legal Markets

The basics of contingency-fee bookkeeping are the same everywhere, but the paperwork around a settlement is not. Here is how the rules change in four of the country’s busiest personal injury markets, and what that means for the books. We work with firms in these markets remotely from our Florida office.

Florida: Miami, Tampa, Orlando, and Jacksonville

Under Rule 4-1.5(f) of the Rules Regulating The Florida Bar, a contingency recovery requires a closing statement that itemizes every cost and expense and shows the fee paid to each participating lawyer or firm. The client and every participating lawyer sign it, and copies of the fee contract and closing statement are kept for six years. The rule also sets presumptive fee percentages that change depending on whether a case resolves before or after an answer is filed. We help make sure each closing statement ties to the client’s trust ledger, line by line, and that the six-year record set stays organized and easy to produce.

New York: Manhattan, Brooklyn, Long Island, and Buffalo

New York personal injury attorneys file a retainer statement with the Office of Court Administration when a client signs on and a closing statement when the matter ends, referencing the original retainer number. We keep a matter list that pairs each open case with its OCA retainer number, so the final figures on the closing statement match the disbursements recorded in the firm’s Attorney Escrow or Attorney Special Account. New York trust records are generally kept for seven years.

Texas: Houston, Dallas, San Antonio, and Austin

Hospitals in Texas can assert liens against a patient’s personal injury recovery under Chapter 55 of the Texas Property Code. When a lien notice is on file, we record the claimed amount on the client’s ledger and keep it there, clearly labeled, until the attorney resolves or reduces it. Texas Rule 1.14 requires complete trust account records to be kept for five years after the representation ends.

Illinois: Chicago and Cook County

The Illinois Health Care Services Lien Act generally caps the combined health care liens on a recovery at 40 percent of the settlement or verdict. That makes accurate lien tracking a real bookkeeping task on Chicago settlements, because the numbers on the closing statement depend on it. Illinois Rule 1.15A requires three-way reconciliation at least quarterly and seven years of records; we reconcile monthly.

Personal Injury Law Firm Bookkeeping Near You

A&W Associates supports personal injury firms throughout Florida, Georgia, Alabama, and New Mexico, and works remotely with firms in Texas, Illinois, and New York. See our service area for the cities where we work with law firms, or contact us to ask about your location.

About A&W Associates

A&W Associates was founded by Angela Weicht, who brings over 25 years of financial and accounting experience, beginning in banking as a risk control specialist and fraud control analyst and continuing as an office manager and accounting manager for private businesses. The firm holds Certified Public Bookkeeper and QuickBooks ProAdvisor credentials and specializes in bookkeeping for law firms and nonprofits.