If they are state-mandated IOLTAs for which the interest is paid to a state agency or state-designated non-profit that funds legal services for indigent folks, they may have a NOW account. Otherwise, they aren't technically an IOLTA.
A law firm theoretically can have an interest-bearing demand deposit account (if you offer them), but state ethics laws or rules may not allow them to earn interest on clients' funds.
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8