Jurisdiction Reference
Arizona IOLTA
Program: Arizona Interest on Lawyers Trust Accounts (IOLTA) Program
Arizona Supreme Court Rule 43 requires lawyers holding Arizona-connected client or third-party funds to use labeled trust accounts. Funds too small or short-term to earn net client interest are pooled in an authorized Arizona IOLTA account whose interest supports the Arizona Foundation for Legal Services & Education.
General information, not legal advice — always confirm against the official Arizona sources below.
Ask about Arizona's IOLTA rules
Deposits, reconciliation, reporting, recordkeeping — answered from Arizona's official sources. Not legal advice.
Quick reference
Plain-language summaries of common Arizona trust-accounting requirements. Use these to orient yourself, then verify the exact rule text through the official sources.
| Topic | Summary | Category |
|---|---|---|
| Separate client and third-party funds | Funds belonging wholly or partly to a client or third person must be kept separate from lawyer and law-firm personal and business accounts. | Arizona Supreme Court Rule 43(a); ER 1.15. |
| Deposit entrusted funds in a labeled trust account | Arizona-connected entrusted funds must be deposited into one or more accounts clearly labeled as trust accounts. | Rule 43(a). |
| Use IOLTA for nominal or short-term funds | Funds that cannot earn net income for the owner after reasonable costs must be pooled in an interest-bearing IOLTA trust account. | Rule 43(f); State Bar Trust Accounts guidance. |
| Use a client-benefit account when net interest is practical | Funds capable of producing net income for the client or third person must be placed in an individual interest-bearing account or appropriately subaccounted pooled account for that owner. | Rule 43(f)(1)(B)-(C). |
| Use an authorized financial institution | An Arizona IOLTA account must be maintained at a financial institution authorized to hold IOLTA accounts and configured to remit interest to the Foundation. | Rule 43; State Bar approved-institution guidance. |
| Prohibit overdraft protection | No trust account required by Rule 43 may have overdraft protection. | Rule 43(a). |
| Limit lawyer funds in trust | Lawyer or firm funds may not be deposited except for narrow rule-based purposes, including amounts reasonably necessary for bank charges and qualifying mixed credit-card receipts. | Rule 43(a)(1)-(3). |
| Maintain a general ledger | The lawyer must keep a chronological record of every trust-account receipt and disbursement with sufficient identifying detail. | Rule 43(b)(2). |
| Maintain individual client ledgers | A separate ledger must be kept for each client or third person whose funds are held in trust. | Rule 43(b)(2). |
| Complete a monthly three-way reconciliation | Every month, the bank statement, general ledger or check register, and total individual client and administrative ledgers must be reconciled. | Rule 43(b)(2)(C); State Bar Trust Account Manual. |
| Preserve required records for five years | Trust-account records must be preserved for at least five years after completion of the fiduciary obligation or final disposition of the funds. | Rule 43(b); ER 1.15. |
| Do not disburse uncollected funds | A lawyer must not disburse against a deposit until the funds are collected, except for limited-risk deposits expressly permitted by Rule 43. | Rule 43(b)(4). |
| Report account opening, changes, and closure | Lawyers must report IOLTA enrollment, account changes, and account closure through the State Bar's member reporting process. | State Bar of Arizona Trust Accounts forms guidance. |
| Remain personally responsible for delegated bookkeeping | Bookkeeping may be delegated, but the responsible lawyer must understand the system, supervise it, and remains accountable for trust-account compliance. | Rule 43; State Bar Trust Account Manual. |
Official sources
The authoritative material for this jurisdiction. Confirm every requirement here before acting on it.
State Bar of Arizona — Trust Accounts
Official overview of Arizona IOLTA and Rule 43 obligations.
OpenState Bar of Arizona — Trust Account Resources and Forms
Current approved-bank, enrollment, reconciliation, and management resources.
OpenState Bar of Arizona Trust Account Manual
Official operational manual for deposits, ledgers, reconciliation, and supervision.
OpenArizona Bar Foundation — IOLTA for Banks
Official participating-bank, interest ownership, remittance, and certification information.
OpenNotes
- Reviewed against Arizona Supreme Court, State Bar, and Arizona Bar Foundation materials available July 14, 2026.
- Arizona's controlling framework combines ER 1.15 with Supreme Court Rule 43; both should be consulted for account handling.
- This summary is educational and does not replace the current rules, approved-bank list, ethics advice, or State Bar guidance.
Arizona — Frequently asked
Common questions for Arizona trust accounts. General information only — verify against the official sources above.
What is Arizona IOLTA?
It is Arizona's pooled interest-bearing trust-account program for client and third-party funds too small or short-term to earn net interest for their owner.
Who must maintain an Arizona trust account?
A lawyer who receives client or third-party funds in Arizona, or in connection with representation of Arizona clients, must maintain the account required by ER 1.15 and Rule 43.
Does every Arizona lawyer need an IOLTA account?
No. A lawyer who never holds entrusted, unearned, disputed, settlement, or similar funds may not need one, but must report status accurately.
Which funds go into Arizona IOLTA?
Nominal or short-term funds that cannot generate net client income after reasonable account costs belong in the pooled IOLTA account.
When should Arizona funds earn interest for the client?
Use an individual interest-bearing account or compliant subaccounting when the amount and duration can produce net income for the owner.
Who receives Arizona IOLTA interest?
The financial institution remits it to the Arizona Foundation for Legal Services & Education; the lawyer has no beneficial claim to it.
May an Arizona IOLTA account be opened at any bank?
No. Use a financial institution authorized for Arizona IOLTA and able to follow the Foundation's account and remittance requirements.
Can an Arizona trust account have overdraft protection?
No. Rule 43 expressly prohibits overdraft protection on a required trust account.
Can lawyer money be kept in the trust account?
Only in limited rule-authorized circumstances, such as a reasonable amount for bank charges or a qualifying mixed credit-card transaction.
How must the account be labeled?
The account must be labeled as a trust account; IOLTA accounts should use the institution's Arizona IOLTA designation and Foundation tax information.
What ledgers are required?
Keep a general ledger or check register plus a separate ledger for every client or third person, and an administrative ledger when lawyer funds cover charges.
How often must Arizona trust accounts be reconciled?
Monthly, using a three-way comparison of the adjusted bank statement, general ledger, and total client and administrative ledgers.
How long are Arizona trust records retained?
At least five years after completion of the fiduciary obligation or final disposition of the funds under the applicable rule.
Can Arizona lawyers disburse before a deposit clears?
Generally no. Rule 43 permits only specified limited-risk deposits, with conditions and a duty to replace a failed deposit promptly.
What should happen to disputed funds?
Keep the disputed portion separate in trust until the interests are resolved, while promptly distributing any undisputed portion.
Where do unearned advance fees belong?
If the funds remain the client's property under the fee arrangement and rules, they belong in trust until earned.
How are IOLTA account changes reported?
Arizona provides enrollment, change, and removal reporting through the lawyer's State Bar member dashboard and trust-account forms process.
Can a bookkeeper perform the reconciliation?
Yes, but the lawyer remains personally responsible, must supervise the work, and should understand and review the reconciliation.
What if a multi-state firm holds Arizona-connected funds?
State Bar guidance generally points Arizona-connected nominal or short-term funds to an Arizona IOLTA account at an Arizona-authorized institution.
Where can a lawyer get Arizona trust-account help?
The State Bar provides a confidential Trust Account Helpline, manuals, forms, approved-bank information, and practice-management assistance.