The services that lawyers, paralegals, and other legal service companies provide will affect how the company’s chart of accounts looks in QuickBooks.
Legal professionals are busy, and it is for that reason that accounting usually is not at the forefront of their minds. However, that does not make it any less important to manage the books. Companies in the law industry offer services such as legal consulting, trial defense, real estate law, probate, will preparation, family law, and much more—all of these things factor into your company’s chart of accounts.
To take a bit of the weight off your shoulders, we developed a free PDF with QuickBooks chart of accounts for legal services.
Lawyers tend to offer only a few different types of services, but since they are all legal services, all income for the company can be placed into a Services income account. If you wish to track where the money is coming from in more detail, you can create new items to help track both the income and costs of a specific job.
On the other hand, there are many different fees and costs in the legal services industry, so it is important to have expense accounts for each of these costs. Some common expenses that can be tracked for the legal industry are travel, food, permit fees, continuing education, and advertising expenses. It is also a common practice to rent out an office in another law practice for meetings. If you do rent from other practices, then make sure to have a rent expense account as well.
If you have any questions about accounting for your legal business, reach out to our team of experts at Fast Trac Consulting!