Lawyers: If you are a lawyer in private practice in the state of Maryland, you must place all eligible client trust funds into an IOLTA account. Your escrow accounts and banking relations will remain the same, and the Maryland Legal Services Corporation will pay reasonable and customary service charges on your IOLTA escrow account.

Interest on Lawyer Trust Account Program (IOLTA) — Compliance

The Maryland Court of Appeals adopted Maryland Rule 16-608 effective January 1, 2002 requiring all Maryland-admitted attorneys to report annually on their compliance with our State’s interest on lawyer trust account (IOLTA) program. This rule is intended to strengthen uniform compliance with the mandatory IOLTA program enacted by the Maryland General Assembly in Maryland Code, Business Occupations and Professions, Section 10-303, effective July 1, 1989.

Why Annual IOLTA Reporting Is Required: IOLTA revenues administered by the Maryland Legal Services Corporation (MLSC) constitute one of our State’s principal funding sources for the provision of civil legal services to our low-income population. However, some Maryland attorneys are not in compliance with the requirement to place all of their IOLTA-eligible trust funds in an IOLTA account or their financial institutions have not designated these escrow accounts properly. The result may be a substantial loss of funding for this essential public program. This compliance reporting rule provides the administrative mechanism to assure full participation in the program.

How to Comply: You do not have to open an IOLTA account to be in compliance with IOLTA. An IOLTA account must be established if you are holding short-term or nominal trust funds of at least $3,500 on a regular basis. If this is not the case, you are eligible for a waiver, and you should open a non-interest bearing escrow account. The waiver is requested when you submit the Annual IOLTA Compliance Report (see Compliance Question 9). To open an IOLTA account, print the IOLTA Enrollment Form and take this with you to the bank when opening a new account.

When to Report: Each Maryland attorney is required to complete annually the Annual IOLTA Compliance Report, as instructed in the letter issued to you at the beginning of the year by the Maryland Court of Appeals. The IOLTA Compliance Report may be filed by mail or electronically, reporting on your IOLTA account(s) in existence as of the date you complete the report. You may complete the form online at www.mdcourts.gov or return the hard copy to the Administrative Office of the Courts, P.O. Box 319, Simpsonville, MD 21150-0319.

For more about compliance reporting and general IOLTA information, see the Frequently Asked Questions - Lawyers.