59%
of invoices were paid within 30 days.
SMB Law Billing and Payments Report: Fall 2026
New data on the financial health of more than 60,000 law firms shows they are getting paid more reliably, but seven in ten still have an invoice past due.
Traditionally, getting paid meant sending an invoice and waiting for payment. Today, firms have a variety of options on how to invoice, how to deliver the invoice, which payment methods to accept, whether to offer payment plans or not, and how to allocate processing fees. Each decision impacts the flow of money, and many law firms tend to make these decisions without considering—or knowing about—alternative opportunities.
As billing and payment options for law firms have multiplied, convenience has skyrocketed. But with that convenience comes complexity in understanding which options will streamline getting paid and close gaps in revenue.
The evidence is in how firms are gaining ground. Among the SMB law firms using 8am MyCase and 8am LawPay, firms were paid more reliably across the board in the first half of 2026, primarily due their becoming more deliberate about business processes: How recorded time converts to an invoice, how an invoice generates payment, and what payment acceptance costs the firm. Despite the improvements, approximately seven in ten firms were still carrying at least one past-due invoice, the same share as a year ago.
The 8am SMB Law Billing and Payments Report draws on billing and payment data from more than 60,000 law firms using MyCase and LawPay, predominantly based in the U.S. In this report, firm size is based on employee count. We define solo firms as one employee, small law firms as 2–5, medium firms as 6–10, and large firms as 11 or more. Published twice a year, this report tracks how billing, time keeping, and payments are shifting, where firms are gaining ground, where they’re losing it, and what those pulling ahead are doing differently.
Receivables improved, time capture drove growth, and more firms passed card fees onto clients
Key takeaways
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Receivables improved consistently. Invoices resolved within a month grew from 58% to 59%, overdue receivables declined at every firm size (27% to 26% overall), and the average unpaid balance dropped nearly 5%. Every month in the first half of 2026 beat the same month a year earlier.
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Billing growth came from better time capture, not higher prices. Hourly rates were unchanged at three of four firm sizes, and what firms actually earned per hour rose between 3% and 5%. Meanwhile, invoiced revenue per firm grew between 5% and 8%. That came from firms invoicing more of the hours they were already recording, with large firms in particular lifting that share from 44% to 49%.
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More firms passed on card fees. Firms charging a card surcharge rose 16%, and surcharges collected per firm rose 25%. Firms also routed their largest bills to eCheck, which carries a flat fee instead of a percentage.
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Practice area shaped how firms got paid. 77% of traffic matter invoices were paid within a month, compared to 34% in workers' compensation matters—though workers’ compensation also had the fewest overdue bills of any practice areas. Family law had the highest share of overdue invoices at 32%.
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Flat fees haven’t taken over. Nearly half of firms sent purely hourly invoices, while just one in ten sent purely flat fee invoices. Flat fees made up 15% of all invoices, down from 16%, with large firms cutting back the most.
Table of contents
- Firms got paid more reliably
- Firms billed more, despite hourly rates staying flat at three of four firm sizes
- Firms got more deliberate about the costs of accepting payments
- Practice area influenced how a law firm got paid
- Flat fee structures did not increase in frequency
- Turn these findings into financial action
Firms got paid more reliably
Getting paid is a part of running a law firm that often happens out of view. The work gets done, the invoice goes out, and what happens next can vary widely. In the first half of 2026, that part of the business got measurably better. Firms were paid faster, carried smaller unpaid balances, and had fewer overdue receivables. However, seven in ten firms were still carrying at least one overdue invoice, the same share as a year earlier. Less money is outstanding, but the number of firms carrying outstanding balances did not change.
Four separate payment measures improved year-over-year:
CHART Year-over-year payment trends
Every month in the first half of 2026 outperformed the same month a year earlier, both on invoices paid in full and those that went past due, and this trend held true across all firm sizes. The share of invoiced dollars paid within 30 days, a key metric, rose 4% year-over-year.
Solo practitioners had the lowest percentage of overdue invoices at 19%, compared to 27% for small and medium firms. Every firm size improved, with large firms doing so most seeing overdue invoices drop from 26% to 24%.
Solo firms had about one in five invoices past due, compared with more than one in four at small and medium firms, an eight-point gap. Large firms fell between them at 24%, so a firm’s benchmark depends on its size.
IMAGE: Past-due https://affinipaydam.com/screens/123886
What it means for firms: Firms are getting paid more reliably across the board. The market has improved on the speed of payments, but not on breadth. Growth can compound the problem, since more clients and matters mean more invoices to chase. Knowing which receivables are aging and how many clients carry balances is a prerequisite for addressing the gap.
Firms billed more, despite hourly rates staying flat at three of four firm sizes
Billing grew across the board, but the mechanism was due to improved realization versus growth in billing rates or hours billed. Three of the four firm sizes tracked didn’t raise their hourly rates, and hours spent per case remained largely flat. However, these firms increased earnings per hour billed between 3% and 5%, and their total billings each month increased between 5% and 8%. With rates and hours being relatively flat, the driver for change was an improvement in how much recorded time made it onto an invoice.
Small and mid-size firms billed fewer cases than a year ago, while billing more dollars overall. Large firms billed 7% more per case, but their monthly billing grew nearly 5%, the smallest gain of any firm size. At every firm size, billing per case and per month rose faster than U.S. consumer prices, which rose 3.5% over the 12 months ended June 2026.
CHART Year-over-year billing & rate changes by firm size
The data also revealed a divide between large and solo firms in how tracked time turns into billed work. Large firms billed nearly 12% more hours while logging fewer overall, raising their share of hours billed from 44% to 49%. Solo firms went the other way: Hours logged rose nearly 9%, but the share billed slipped from 70% to 69%.
IMAGE Hours recorded & hours billed by firm size https://affinipaydam.com/screens/123887 What it means for firms: Before raising rates, assess how much tracked time is being invoiced. Large firms billed more of the time they were already tracking, and that gap is the driver for this year's growth. IMAGE 2026 Admin Misery Index IMAGE OR BUILD?
Firms got more deliberate about the costs of accepting payments
Payment processing stopped being a cost firms simply absorb. Instead, they increasingly passed card fees to clients and moved money onto more cost-effective systems. Both were led by the firms with the largest average payments: $2,231 per transaction at large firms compared to $1,503 for solo firms, so a percentage-based card fee costs large firms more on every payment they accept.
The number of firms charging a card surcharge rose 16% year-over-year, while the surcharge rate itself stayed nearly flat at 2.6%. More firms passed the fee along to clients, a common business practice in other industries, rather than charging a higher rate. On average, firms collected 25% more in surcharges than they did a year earlier.
IMAGE Surcharge adoption and revenue
Larger payments skewed toward eCheck. The average eCheck payment in the first half of 2026 was $2,206, compared with $1,491 for card. Because eCheck is priced per transaction rather than as a percentage of the payment, the fee gap between eCheck and card payments widens as the payment grows. Card payments’ share of dollars collected fell about two percentage points over the same period.
By firm size, two opposite strategies showed up. Large firms pushed costs onto clients, and small firms offered clients flexibility instead, with surcharging and pay-later adoption moving in opposite directions across the size bands.
What it means for firms: The bigger your average invoice, the more a percentage-based fee costs your law firm. Check your state before surcharging, since it remains prohibited in some jurisdictions. Steering large payments to eCheck and small ones to card is a strategic lever.
Practice area influenced how a law firm got paid
Two law firms can run identically and still see very different revenue. For instance, a traffic practice—which had the highest share of invoices paid within 30 days—bills small, predictable amounts and often collects up front. A workers’ compensation practice, which had the lowest share of invoices paid within 30 days, is often at the mercy of insurers. The work itself influences the pace of payment.
The range was wide. The practice area at the top collected more than twice as many invoices within a month as the bottom one. Payment patterns also varied sharply by practice area, reflecting how the work itself is structured, including matter size, whether clients pay up front, and whether an insurer is involved.
IMAGE Payment trends by practice area Image: https://affinipaydam.com/screens/123891
Workers' compensation firms had the lowest paid-in-30-days rate of any practice area, at 34%, but also the lowest overdue rate, at 8%. Over half of workers' compensation bills were still within terms at the 30-day mark, neither paid off nor overdue, because insurers on these claims tend to pay on longer, more predictable schedules.
In the first half of 2026, traffic firms had the highest share of bills paid off within 30 days, at 77%, while family law carried the highest overdue rate, at 32%. That ranking held steady year-over-year, with workers' compensation, traffic, and bankruptcy the three lowest on overdue rate in both periods, and family law the highest in both periods.
Overdue rates fell year-over-year across the vast majority of practice areas examined, and debt-collection firms improved the most, cutting overdue bills by almost nine percentage points.
What it means for firms: Payment patterns are heavily influenced by the kind of work a firm does. Set payment terms and follow-up timing around your own practice area to capture more revenue.
Flat fee structures did not increase in frequency
For most of the past decade, the legal industry has been predicting a shift away from the billable hour, because clients want predictability. The data showed firms making a different choice.
Flat fees made up 15% of all bills sent in the first half of 2026, down from 16% a year earlier. Large firms cut back the most, from about 16% to 14%. Solo firms were the exception, rising just over half a point to 17%, while small and mid-size firms largely stayed the same.
Additionally, nearly half of firms sent purely hourly bills, while just one in ten sent purely flat-fee bills. The rest—about 42%—used a combination of both, and more than half of those firms sent a quarter or less of their bills as flat fee.
IMAGE How firms split between hourly and flat fee Image: https://affinipaydam.com/screens/123892
Whether a firm chooses to use flat fee rates often comes down to the nature of the work, not preference. Flat fees made up nearly 90% of bills in traffic practices and about two-thirds in immigration. For family law, it was under 3%, and under 1% in workers’ compensation. CHART Flat fee share of bills by practice area
Immigration stood out as one of the most flat-fee-heavy practice areas, but its flat-fee share dropped more than four points this year.
What it means for firms: Billing model is largely determined by the work, not preference. Before choosing between flat fee and hourly, consider whether a given matter is predictable and bounded enough to price up front. If it is, a flat fee makes sense. If it isn't, hourly protects the firm.
Turn these findings into financial action
The findings above point to a few concrete moves worth carrying into 1H 2027 planning.
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Look at what's reaching the invoice. Billing growth in this data came from more recorded time making it onto invoices, not higher prices. A firm should check how much tracked time reaches an invoice and benchmark law firm billing rates against firms its size before raising rates.
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Put detail on every bill, even the fast ones. Clear, itemized detail reduces disputes and follow-up work later.
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Treat payment method as a cost decision. A firm's average bill size should determine whether surcharging, eCheck routing, or flexible payment options make more financial sense.
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Operational improvements drive growth to the bottom line. The gains in this report came from firms handling the business side more deliberately, including how time gets billed, how bills get paid, and what collecting costs the firm, rather than raising prices.
This report is the first edition of a twice-yearly series. We'll be back in spring 2027 with the next data set, continuing to track these same measures over time, along with other dynamics shaping how small and mid-size firms get paid.
Ready to get paid faster, bill more of your tracked time, and keep what it costs to get paid in check? Check out our newest innovations in the 8am Showcase .
Methodology:
The SMB Law Billing and Payments Report analyzes aggregate billing and payment data from more than 60,000 law firms, predominantly based in the U.S., using 8am MyCase and 8am LawPay. The data spans January 2025 through June 2026. All year-over-year comparisons measure 1H 2025 against 1H 2026.
Firm size is defined by employee count: solo (1), small (2-5), medium (6-10), and large (11 or more). Size reflects firm-reported data where available and platform user counts where not.
Billing and payments figures compare the same firms across both periods; invoices are counted as paid or overdue against a 30-day maturation window, and invoices too recent to have reached that mark are excluded. Payment figures weight each firm equally. Test accounts, trial accounts, draft invoices, and inactive firms are excluded throughout. Data reflects the activity of 8am users and is not representative of every law firm in the U.S. legal market.