Categories : Current Topics Law Practice Management
IRS Properly Reconstructs Attorney’s Income: The Importance of Trust Fund Accounting Through the Lens of Tax Litigation
By Shawn Spaulding
As attorneys, we are all familiar with the trust fund accounting requirements found in Rule 4-100 of the State Bar of California Rules of Professional Conduct. Failure to follow Rule 4-100 can result in significant disciplinary action. But, the importance of proper trust fund accounting is not limited to the Rules of Professional Conduct. As discussed below, failure to maintain accurate trust fund records can end up costing you thousands in additional taxes and penalties.