DC's business landscape moves fast — federal contractors, nonprofits, consultants, and hospitality operators all have different compliance needs. Capital Accounting Group keeps your books reconciled weekly so you're always ready for an audit, a grant report, or tax season.
Law firm bookkeeping is not just small-business bookkeeping with invoices. The moment a client retainer hits your IOLTA trust account, you take on a fiduciary obligation that the DC Bar, the Maryland State Bar, and the Virginia State Bar all enforce with teeth. A single trust-account reconciliation error, a single commingling of client funds with operating funds, a single missed three-way reconciliation can turn into a disciplinary complaint. Generalist bookkeepers do not understand this — they treat the IOLTA account like any other checking account and book retainer receipts straight to revenue. We do not.
Our law firm bookkeeping practice handles the specific problems your firm actually has: three-way reconciliation of IOLTA trust balances (client ledger + trust journal + bank statement, matched to the penny, monthly); proper retainer accounting with earned versus unearned balances tracked at the matter level; contingent fee revenue recognition that satisfies GAAP and your CPA without prematurely recognizing income on a case that could take three years; 1099-NEC tracking for contract attorneys, process servers, court reporters, and expert witnesses; PTET (pass-through entity tax) election analysis for DC, Maryland, and Virginia law firms structured as partnerships or S-corps — which can save the partners significant federal tax by working around the SALT cap; and matter-level profitability reports so you know which practice areas actually make money.
We work with solos, small partnerships, and firms up to about 15 attorneys. If you are on Clio, MyCase, PracticePanther, or Smokeball for practice management, we integrate your bookkeeping without double-entry — your time entries and trust transactions flow into QuickBooks cleanly. If you are still running trust accounting on a spreadsheet, we migrate you to a compliant system and train your office manager on the reconciliation cadence. At year-end, your CPA gets a clean set of books, a documented trust reconciliation trail, and a PTET election analysis so the partners pay the right amount of federal tax — not a dollar more.
Our law firm bookkeeping practice is based in the Washington DC metro area and works with clients across Washington, DC, Arlington, VA, Alexandria, VA, Bethesda, MD, Silver Spring, MD, Rockville, MD, Kensington, MD, Montgomery County, MD, and Adams Morgan, DC.
How often does my IOLTA trust account need to be reconciled to stay in compliance with the DC Bar?
Monthly, and with a specific method. The DC Bar (Rule 1.15), the Maryland Rules (Rule 19-407), and the Virginia Rules (Rule 1.15) all require three-way reconciliation: the bank statement balance, the total of individual client ledger balances, and the trust journal running balance must all agree each month. If any one of the three is off, you have a problem that needs to be traced and corrected before the next month closes. We perform this reconciliation monthly, document the client-level detail, and flag any stale balances (retainers sitting unearned for months) for you to address.
Can my DC or Maryland law firm elect PTET to work around the federal SALT cap?
Yes, if your firm is structured as a partnership, LLC taxed as a partnership, or S-corp. DC enacted its PTET for tax years starting in 2022; Maryland has had one since 2020; Virginia since 2021. The election lets the firm pay state income tax at the entity level and deduct it federally (outside the $10,000 SALT cap), then the partners receive a state tax credit for their share. For a firm with $1M of income and partners in high federal brackets, the federal tax savings typically run $20K–$50K per year. We run a projection before each election deadline so you know whether to elect that year.
How do I recognize revenue on a contingent fee case that spans two or three tax years?
You do not recognize revenue on a contingent fee case until the contingency is resolved and your fee is determined. Until then, case costs you advance (filing fees, deposition costs, expert witness fees) are either expensed or treated as loans to the client depending on your method — and there is ongoing debate about which is correct under current IRS guidance. Retainers and hourly billings on the same case can be recognized as earned. We set up a hybrid-friendly chart of accounts and matter-level ledger so your contingency practice and hourly practice can coexist in one set of books, and your CPA can file a consistent return year over year.
Every small business bookkeeper client in Washington DC gets the complete service. Plus a free business CRM that replaces tools costing $260–$880/month.
If any of these hit home, we should talk. Free 15-minute consultation, no pressure.
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Serving businesses in Georgetown, Capitol Hill, Navy Yard, Columbia Heights, Shaw, Logan Circle and surrounding areas including Chevy Chase DC, Friendship Heights, Tenleytown, Brookland. Zip codes served: 20001, 20002, 20003, 20004, 20005, 20006, 20007, 20008, 20009, 20010, 20011, 20012.
We're not a national chain. We understand Washington DC's local tax rules, industry mix, and what government contractors owners actually need from a small business bookkeeper DC.
We serve small businesses throughout Washington DC, Maryland, and Virginia.
All services designed for Washington DC small businesses.
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