California attorney trust accounts: The new 2026 rules

Key Takeaways

• Every California attorney with an existing client trust account must serve a completed Notice to Financial Institutions form, identifying the designated licensee and State Bar number, by July 1, 2026, under Assembly Bill 3279.

• Starting January 1, 2026, financial institutions holding attorney trust accounts must electronically report account balances to the State Bar every year between January 1 and March 1, under Business and Professions Code §6091.3. The attorney does not file this report, but is the one whose license number appears on it.

• This is separate from CTAPP annual self-reporting, which already required attorneys to answer whether they hold trust accounts and complete related compliance questions. The new rule adds a second, independent bank-side report that cross-references the attorney's own filing.

• An attorney who has changed banks, merged firms, or added a new trust account since their last CTAPP filing and has not updated the Notice to Financial Institutions is the person most likely to have a mismatch flagged when the two reports are compared.

• The Established Compliance Rate for IOLTA accounts is 68% of the federal funds rate or 0.68%, whichever is higher; this rate determines what the bank owes in interest to the State Bar, not what the attorney owes anyone directly, but it is the number examiners check first if a compliance question arises.

A solo practitioner in Sacramento opened her IOLTA account in 2019 at a bank that has since been acquired twice. The account still functions, deposits and disbursements still clear normally, and nothing about her day-to-day trust accounting has changed. What has changed is that her bank is now required to report her account balance to the State Bar every year starting in 2026, and unless she has served an updated Notice to Financial Institutions with her current State Bar number attached to that specific account, the report the bank files may not connect cleanly to her CTAPP filing. Nothing about her bookkeeping was wrong. The paperwork trail behind it has a new requirement she hasn't completed yet.

Numetix takes an expert-led, AI-powered, and human-in-the-loop approach to trust account compliance, tracking the procedural requirements layered on top of day-to-day reconciliation, not just the reconciliation itself. This guide covers exactly what California's 2026 rule changes require and the deadline that matters most right now.

Quick Answer: What are California's new 2026 attorney trust account rules?

• Every California attorney with an existing client trust account must serve a Notice to Financial Institutions form, with the designated licensee's name and State Bar number, to their bank by July 1, 2026, under AB 3279.

• Separately, banks holding attorney trust accounts must now electronically report account balances to the State Bar annually, between January 1 and March 1, starting in 2026, under Business and Professions Code §6091.3.

• These two requirements work together: the Notice to Financial Institutions form is what allows the bank's annual report to correctly identify which attorney is associated with which account.

What Business and Professions Code §6091.3 actually requires

Effective January 1, 2026, financial institutions offering client trust accounts, both IOLTA and non-IOLTA, to California-licensed attorneys must electronically report to the State Bar, annually between January 1 and March 1: the financial institution's name, the name of the attorney or law firm associated with the account, the account number, the attorney's State Bar license number, and the trust account balance as of December 31 of the prior year. This is the bank's obligation, not the attorney's direct filing obligation, but the report is only useful to the State Bar if the account is correctly linked to the right attorney, which depends entirely on the Notice to Financial Institutions form being current.

What AB 3279 requires of the attorney directly

For existing trust accounts, California attorneys are required to provide the Notice to Financial Institutions form by July 1, 2026, identifying the designated licensee name and State Bar number for each client trust account. This form must be served on the financial institution in compliance with Code of Civil Procedure §684.115, not simply emailed informally. An attorney with multiple trust accounts, across different banks or different practice entities, needs a separate, correctly completed notice for each one. This is the step most likely to be missed by attorneys who assume their bank already has their information on file from account opening; account-opening paperwork from years ago does not satisfy this specific, newly created notice requirement.

How this connects to, and differs from, CTAPP annual reporting

The Client Trust Account Protection Program (CTAPP) already required California attorneys to answer annually whether they maintain trust accounts, and to complete related self-reporting questions as part of their State Bar license renewal. The new bank-side reporting under §6091.3 is a separate, independent verification layer: the State Bar now receives account balance information directly from the financial institution, not solely from the attorney's own self-reported answers. A discrepancy between what an attorney reported through CTAPP and what their bank reports under the new rule is precisely the kind of mismatch that could draw scrutiny, even where the underlying trust accounting was handled correctly.

Frequently asked questions

Does this apply to attorneys who opened their trust account years ago?

Yes. AB 3279 specifically addresses existing trust accounts, not just newly opened ones, which is why the July 1, 2026 deadline applies broadly regardless of when the account was originally established. An attorney cannot rely on paperwork completed at account opening in a prior year to satisfy this new, separately created notice requirement.

What happens if an attorney misses the July 1, 2026 deadline?

The State Bar's guidance treats this as a compliance requirement tied to trust account maintenance, and CTAPP reporting explicitly requires attorneys to confirm compliance with rule 1.15 obligations, which the notice requirement now falls under. Missing the deadline creates a gap between the attorney's CTAPP answers and what the bank's independent report to the State Bar will show once that reporting cycle begins, which is the kind of mismatch compliance reviews are designed to catch.

Does the new bank reporting rule mean the State Bar can see an attorney's trust account balance at any time?

The rule as written establishes an annual reporting window, December 31 balances reported between January 1 and March 1 each year, not continuous or real-time visibility. Separately, financial institutions already have an independent obligation under Business and Professions Code §6091.1 to report to the State Bar any instance of a trust account overdraft, regardless of the annual balance reporting cycle, which is a distinct and pre-existing requirement.

For law firms that need trust account compliance tracked at both the reconciliation level and the regulatory filing level, our bookkeeping services flag procedural deadlines like this one before they become a mismatch on record, expert-led, AI-powered, and human-in-the-loop.

See the complete guide to bookkeeping for law firms for the full trust accounting and compliance framework.