THE LAWYER’S TOOLBOX By Scott Stevens
How Do I Begin?
The first step is deciding where you want your law office located. Do you want a bricks and mortar office, a virtual office, or shared space like Launch Workplaces. Professional business street addresses can be rented through facilities such as UPS Store or businesses such as Launch. Concierge and answering services may also be available.
This is the question new attorneys must ask before beginning their practice. It is not something taught in law schools. Fortunately, Baltimore County Bar Association members Eric Steiner, Bill Alcarese and Sandy Steeves stepped up and helped answer that question with the "Lawyer's Toolbox" presentation jointly sponsored by the Solo & Small Firm and In addition to the pre-planning cost analysis, new Technology Committees. attorneys also need to setup an accounting system. They discussed the very basics such as budgeting for This could be QuickBooks, an accountant, a cloud a practice, considering business entities, and setting service, or even just a spreadsheet. The important up bank accounts. They also went into detail about thing is to set it up and create good habits of keeping track of the finances. Always reconcile your accounts. what technological resources are available to make a Credit card transactions can disrupt account levels. solo/small firm practitioner's life easier. However, new attorneys should setup credit card (and All of the panelists emphasized performing a cost maybe even Venmo) payment systems. To be paid analysis prior to starting a practice. Costs and fees promptly, accept payment methods your clientele sneak in and add up. Getting started, however, may be prefer. easier than you think. Other recurring themes in the Every law firm will have at least two accounts: the presentation included: operating fund and the trust/escrow fund. There will 1. Be Nimble be one trust/escrow account. Tracking funds from multiple clients in the one account can be done 2. Pre-planning & Managing the Money, and through software. One very important tip: make sure 3. Use Technology To Make Your Life Easier the bank you use for these accounts deducts any fees Be Nimble that apply to the trust/escrow account from the Nimbleness is critical when starting out. All you operational account.
really need to start a law practice in this day and age is a computer and a telephone. Given current technology, these could even be the same device. Also, consult an accountant regarding how to set up your practice for tax purposes. Picking the proper business entity is important for liability protection. Starting out as a sole proprietorship may make the most financial sense for some practitioners.
There are requirements and considerations. Typically, you will need a Federal Tax ID. (Think social security number for a business.) You must decide if you can afford to purchase malpractice insurance and what risks you will face if you choose not be insured. It was suggested that One Million Dollars of malpractice insurance should suffice for most new attorneys. Coverage should cost about $1,200/year. While helpful, you don't need a staff. There are Stay on a steady billing cycle and use software like virtual concierge services. But if you do hire staff, TimeSlips. Billing is time consuming, but it must be make sure you understand if they will be employees done. or contract workers. If you hire employees, will you Finally, will you need or want a small business loan offer benefits? to get started? Be prepared to explain to the bank how you realistically plan to repay the loan. Pre-planning & Managing the Money THE ADVOCATE
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May 2021
