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Run the Payroll Fee Auditor →Blog · Payroll Management · Law Firm
Law Firms: Setting Up Direct Deposit (2026)
Direct deposit for a law firm is set up once per employee with a bank authorization, prenoted, then paid through ACH on the pay schedule the state allows, with billable hours tracking and partner draw vs. salary settling on the same file. BEG runs law firm payroll for $45 per employee per month inside the payroll software you already use, all-inclusive, live in 3 to 5 business days.
Setup for law firms
Each employee signs a direct deposit authorization with routing and account numbers, the account is prenoted with a zero-dollar test before the first live deposit, and split deposits are recorded per employee. Federal law does not let an employer make direct deposit mandatory to a bank of the employer's choosing, and most states require a paper or pay card alternative for employees who do not opt in.
Employees holding a valid license to practice law who actually practice are exempt professionals, and the salary level and salary basis tests do not apply to them. Job titles alone do not determine exemption status; duties and pay must meet the regulations.
Timing and the law firm pay cycle
The ACH file goes two banking days before payday for the funds to land on the date, which means hours for attorneys and paralegals close earlier than the payday itself, and billable hours tracking for the period is settled on that file or on a documented later settlement date. Off-cycle runs, final checks and corrections use same-day ACH where the bank supports it.
The rules behind this page, with sources
General information, not legal advice. Every rule below was read on the agency page linked next to it.
- Employees holding a valid license to practice law who actually practice are exempt professionals, and the salary level and salary basis tests do not apply to them. Job titles alone do not determine exemption status; duties and pay must meet the regulations. [DOL Fact Sheet #17D]
Read the full guide to how to set up direct deposit, and the rest of the law firm payroll library.
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Frequently Asked Questions
Can a law firm require direct deposit?
Federal Regulation E bars an employer from requiring deposit to a particular bank; the employee chooses the account. Many states add that a no-fee alternative must be offered, so a written opt-in with an alternative is the safe policy.
When does the law firm pay file have to be released?
Two banking days before payday for standard ACH. Same-day ACH is available for off-cycle runs and corrections at a higher per-item cost. Employees holding a valid license to practice law who actually practice are exempt professionals, and the salary level and salary basis tests do not apply to them.
What does managed payroll cost for a law firm?
$45 per employee per month, all-inclusive, inside the payroll software you already use, with no monthly minimum. Billable hours tracking, partner draw vs. salary and attorney bonus structures are configured at setup, not billed as add-ons.
Related Resources
Anthony leads payroll solutions at Business Executive Group, a national managed payroll firm serving businesses across industries including Law Firms. BEG manages payroll at $45 PEPM, all-inclusive, with deep expertise in compliance, multi-state filing, and industry-specific payroll requirements. Get instant pricing at beghr.com.
Authoritative source: IRS: Understanding Employment Taxes
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