Starting A Law Firm: How To Open Bank Accounts

I have always been afraid of banks. ~ Andrew Jackson

The first time I experienced how difficult starting a law firm is happened in a bank. Actually it happened in a bank for four and a half hours. And then in another bank for another four hours.

Our first bank gave me a Real Estate Brokers Account. We are not real estate brokers. They also promised that checks were free. They then charged us $100 from checks and took the money out of our IOLTA account (which didn’t have any money in it). This caused the IOLTA account to be overdrawn. At 5:30 on a Friday morning I was sending an email to the Statewide Grievance Committee explaining what had happened. After several phone calls with the bank, they corrected their mistake. We switched banks a month later.

Dealing with banks taught me the first law of managing a firm: Everything takes forever.

Welcome to Bankland.


If you are starting a firm you’ll likely decide to form some sort of liability limiting entity (pick’em: LLC, LLP, PC. S-Corp). Before you can obtain a bank account for your entity you must first create the entity and properly register it with the Secretary of State. Then you must obtain a federal tax identification number from the IRS. You will need both of those things prior to walking into a bank.

You’re also going to need a firm juris number. You must get that number from the Statewide Grievance Committee.

Getting what you need to open your bank accounts can easily take two weeks. Plan for this.


First you’re going to need to bring money to the bank. Banks have minimum deposits required to open accounts. Find out what that amount is and make sure you have it. Also make sure you have at least two forms of identification (e.g. driver’s license and passport) and a certified copy of your articles of organization.

At a minimum you are going to need two accounts. Your first account is your operating account. The second account is your client’s trust account (IOLTA). You should get different colored checks for each account. One cannot violate the first rule of attorney ethics: Thy client’s funds account is sacred. You can’t violate that by mistake. You can’t violate that even for one second.

On the advise of a very wise law firm bookkeeper, we opted for a second IOLTA account. We use our second IOLTA account solely for real estate transactions. In real estate transactions, large amounts of money come into the account for very brief periods of time. Having a second account solely for real estate makes reconciling our normal IOLTA account easier. We use green checks for our real estate trust account. Green for grass. The kind you mow.

Extra Points:

Strongly consider getting a credit card with a small limit. Our bank was willing to open small credit accounts in the name of our business. We use these cards to pay all of our monthly subscriptions and for firm expenses. It is an accounting efficiency for us. We look at our credit card statements and then make entries into quickbooks. This allows us to write one check a month for the majority of our expenses.

A small limit will also help you live within your means.  Early in your business life cycle it may be tempting to lean on the card heavily. A small limit on a credit card that you can pay off every month is perfect. You can also earn points.

Also consider a business savings account.

We love our mobile banking. We’re able to deposit checks to our operating accounts directly from our phones. This saves us trips to the bank. Really investigate your bank’s mobile and online features. Depositing checks without having to go to a bank saves time.

Post Game Analysis: 

Your bank, your bank accounts, and the ways in which you interact with your bank are critical to your existence as a law firm. Ask lawyers in your area what bank they use and if they are happy with their bank.

And plan to be in the bank for four hours. And if you are forming a partnership – it’s likely all of the partners must be at the bank – likely for four hours. That’s after it’s taken you two weeks to form your entity, get your tax id, and obtain a firm juris number.


McKeen Law Firm is a Glastonbury law firm that litigates difficult cases, closes real estate deals, and serves as trusted advisors to individuals and small businesses.

Ryan McKeen is a trial attorney at Connecticut Trial Firm, LLC in Glastonbury, Connecticut. In 2016, he was honored by the CT Personal Injury Hall of Fame for securing one of the highest settlements in the state. He is a New Leader in the Law. ABA 100. Avvo 10. 40 under 40 for Hartford Business Journal. He has been quoted in Time Magazine, the New York Times, Hartford Courant, Wall Street Journal Law Blog and the Hartford Business Journal. He focuses his practice on Connecticut Personal Injury law. He loves what he does. Contact him or 860 471 8333

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