Boost Time Tracking Efficiency with an Attorney Billable Hours Chart
By Adrian Aguilera
Tracking and logging billable hours shouldn’t be an undesirable, taxing process. With an attorney billable hours chart, you’ll have a system for efficiently and ethically recording all billables. Paired with helpful software tools, your firm will enhance productivity, improve cash flow, and delight clients.
This article provides a practical billable hours chart setup your firm can implement today, with additional tips for effectively monitoring and recording billable hours.
What are Considered Billable Hours?
All the time spent on case work (requiring legal skill and judgment) qualifies as billable time. As a refresher for your law firm, this includes but is not limited to case-focused research, drafting of pleadings, and court appearances. Non-billable hours typically involve clerical tasks that require no legal skill. For example, duplicative work such as invoicing, client meeting scheduling, and/or closing files fits in the non-billables bucket. Due to the complex nature of calculating (and ethically) invoicing clients for billable time, it’s often challenging for law firms to monitor a wide range of daily tasks consistently—often performed simultaneously.
How do Attorneys Calculate Billable Hours?
Attorneys have a wide variety of methods for tracking billables. This can include logging them by hand, typing them into a spreadsheet, or using a software program.
There’s one common problem. Lawyers are constantly on the move and often work on multiple cases simultaneously. This makes tracking billable hours a challenging task that is often left for the end of the week, or worse, the end of the month. As a result, attorneys are left scrambling, reviewing, and attempting to remember all billable tasks that were performed.
Fortunately, a couple of systems can solve the complex and time-consuming process of tracking billable hours and preparing fair and accurate client invoices. The use of an efficient attorney billable hours chart provides a road map of the time increments your firm can use. In addition, time tracking software (explicitly built for lawyers) can reduce the last-minute scramble by providing your firm with tools for logging billable hours as it occurs.
What are the Average Billable Hours for Attorneys?
Most lawyers calculate billable hours in one-tenth hour increments (six-minute time frames). This billable hours system is an easy and efficient way to bill clients since it provides an ideal balance of tracking a reasonable range of hours with work entry specifics per range. Tracking shorter time increments can lead to a more time-consuming process, while larger increments can result in the temptation of padding hours. This billable hours chart chart solves both problems.
Can an Attorney Deduct Billable Hours to a Charity?
Certain factors qualify as a tax write-off if you’re considering pro-bono work to help a charitable cause or organization. Unfortunately, the IRS does not qualify your time and labor aiding a charity (at your billing rate) as a tax deduction. However, certain qualifying expenses incurred while volunteering your legal services are eligible for a tax break.
For example, this could include:
- Unreimbursed office supplies, filing fees, and/or postage.
- Advertising and broadcasting fees (benefiting the charitable organization).
- Certain traveling expenses to and from non-profit activities.
As a rule of thumb, keep all receipts and request official receipts from non-profit clients as extra insurance. And before attempting deductions, speak with a tax advisor as a safety precaution.
Benefits of an Attorney Billable Hours Chart
Following an organized chart for your billable hours is an efficient way to keep your invoices neat and standardized—while effectively detailing all client costs. Pairing an attorney billable hours chart with legal case management software tools will help you track all billable work. And when it’s time to invoice your clients, legal invoicing and legal payments software provide clients with an efficient way to pay—boosting your firm’s cash flow.
Best Case-Management Software for Tracking Time
Case management software makes it easy to track your hours when implementing a billable hours chart. Your time is readily incorporated into the software and automatically separated case-on-case basis. The software also includes financial reporting to monitor aging invoices, gain insight on payments billed and collected, track active payment plans, and more.
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