Yes, a lawyer may generally bill for time actually spent using and checking AI, but not for time the tool saved. For hourly billing, that means charging for real work—such as entering information, refining a prompt that requires legal judgment, and reviewing or correcting output—not for the time a task might have taken without AI. Flat fees and AI-related expenses follow different tests: they must have a reasonable basis, and the client should be told how they are calculated. Whether a lawyer must disclose AI use itself depends on the jurisdiction and the circumstances.
In the United States, the ABA Model Rules and state guidance provide a useful framework, but they do not replace the rules that apply in a particular state, a client’s engagement agreement, outside-counsel billing guidelines, or a court order. The discussion below is general information, not advice about a particular bill or jurisdiction.
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What can a lawyer charge for when using AI?
The key distinction is between work the lawyer actually performs and work the software makes unnecessary. ABA Formal Opinion 512 (2024) applies the ordinary hourly-billing principle: a lawyer who bills by time must charge for actual time expended, not an estimate of the time the same task would have taken if done manually.
The opinion gives a hypothetical: a lawyer uses a generative AI tool to draft a pleading and spends 15 minutes entering relevant information. The lawyer may charge for those 15 minutes and for the actual time spent reviewing the result. The example is not a standard fee or a statistical measure; it illustrates the difference between recorded work and time saved.
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Depending on the assignment and the applicable rules, actual work may include preparing or refining prompts that require legal skill, supervising the tool, checking the output for accuracy and completeness, correcting it, and applying legal judgment before using it. The fact that software generated text does not make the lawyer’s verification unnecessary. Conversely, a lawyer cannot put the minutes or hours AI saved onto an hourly bill as though that time had been worked.
ABA Formal Opinion 512 quotes an earlier ABA opinion for the principle that a lawyer billing by hours does not meet the ethical duty if the lawyer bills for more time than was actually expended on the client’s behalf. In practical terms, an hourly invoice should describe and record human work, not a hypothetical manual workflow.
How hourly, flat, and contingent fees differ
AI does not create one billing rule for every engagement. The arrangement determines what the client is being charged for, while the reasonableness of the fee and any applicable agreement or client restrictions remain important.
| Billing arrangement | What the charge is based on | How AI changes the analysis |
|---|---|---|
| Hourly | Time actually spent on the client’s matter | Bill actual time on AI-related work and review; do not bill time saved by the tool. |
| Flat fee | An agreed fee for defined legal work | The fee must remain reasonable in context. A substantial reduction in work caused by AI may matter, but AI use does not automatically require a discount. |
| Contingent fee | The agreed contingent-fee arrangement | ABA Formal Opinion 512 says the applicable reasonableness analysis still matters; the outcome depends on the agreement and circumstances. |
| AI tool or service expense | A disclosed charge for a tool or service, if permitted | The lawyer needs a defensible basis for the charge, and jurisdictions may distinguish general overhead from matter-specific costs. |
Hourly billing: record actual work, not a manual-time estimate
A time entry should reflect the work actually done. If a lawyer spends time supplying facts to an AI system and then checks its draft, those are distinct tasks that can be recorded at the time spent, subject to the engagement terms and client billing instructions. The lawyer should not bill the amount of time they believe drafting would have taken without AI, nor bill the same work twice under different descriptions.
For example, if a lawyer spends 15 minutes entering case information and then 40 minutes checking authorities, revising the draft, and deciding what can safely be used, the hourly record would reflect those actual activities and their actual duration—not a larger figure based on a manual drafting estimate. This is an illustration of the timekeeping principle, not a prescribed billing increment or a conclusion about whether every minute in a particular matter is chargeable.
Flat and contingent fees: reasonableness still applies
A fixed fee is not calculated by multiplying every task by hours worked, so the hourly rule does not automatically convert it into an AI-discount formula. However, ABA Formal Opinion 512 says the reasonableness standard in Model Rule 1.5 applies to flat and contingent fees as well. It cautions that a flat fee may be unreasonable in some circumstances if AI lets the lawyer finish substantially faster yet the lawyer charges the same amount as when the work required considerably more effort. The opinion also cites the principle that a fee for which little or no work was performed can be unreasonable.
That is a context-dependent warning, not a rule that every use of AI requires a lower flat fee. The scope of the engagement, the result, the agreement, the work that remained necessary, and the jurisdiction’s rules all matter. North Carolina State Bar Formal Ethics Opinion 1 (2024), for example, says a lawyer may consider a flat fee for AI-assisted document drafting if the amount is not clearly excessive and the client consents to the structure.
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Random freezes, missing sound and display glitches usually trace back to one bad driver. Find and replace yours safely.Free scan · under a minuteFor contingent fees, the practical question is not simply how quickly a document was drafted. The fee must be assessed under the applicable agreement and reasonableness rules. ABA Formal Opinion 512 does not establish a separate AI percentage or a universal adjustment formula.
Can a lawyer pass AI software costs on to a client?
AI expenses are separate from fees for the lawyer’s time. A lawyer’s ability to charge a client for a tool or service depends on the charge’s basis, the engagement terms, applicable ethics rules, and any client-specific billing restrictions. ABA Formal Opinion 512 says AI expenses are subject to reasonableness and that the basis for an AI charge should be explained before billing.
The distinction between general office overhead and a cost specifically incurred for one matter is important, but the rules vary by jurisdiction. California State Bar guidance updated May 14, 2026, says general-purpose AI subscriptions are typically overhead. It also describes circumstances in which a cost incurred specifically for a client matter and beyond general office operations may be charged, subject to conditions. The agreement should clearly disclose the separate cost, the charge should reasonably reflect the actual cost, and the lawyer should not add a markup or profit element without the client’s informed written consent.
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North Carolina Formal Ethics Opinion 1 (2024) allows accurate, not clearly excessive AI-related expenses with client consent, preferably in writing. Arizona guidance provides illustrative sample language, but a sample line item or dollar figure should not be treated as a universally lawful fee or a recommended amount. These examples are not interchangeable national rules.
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- Matter-specific expense: A separately incurred cost may be treated differently where the jurisdiction permits it, the client has been appropriately informed, and the amount reflects the actual cost under the relevant guidance.
- Markup or profit: California guidance requires informed written client consent before adding a markup or profit element to a qualifying matter-specific cost.
- Client restrictions: An engagement term, outside-counsel guideline, or other client instruction may limit or prohibit a charge even if a general ethics rule would otherwise permit it.
Does the lawyer have to disclose AI use?
There is no universal answer in the cited state guidance. Three separate issues are often conflated: explaining the basis of a fee, telling the client that AI was used, and including AI terms in an engagement letter. A lawyer may have a clear duty to explain a proposed charge without having a categorical duty to announce every AI use. The reverse is also possible: the circumstances may call for communication about AI even where the lawyer is not charging a separate AI expense.
1. Explain the basis for fees and expenses
ABA Model Rule 1.5(b), as discussed in Formal Opinion 512, calls for communicating the basis or rate of fees and expenses before or within a reasonable time after representation begins, preferably in writing. Before charging for AI tools or services, the lawyer should explain the basis for that charge, also preferably in writing. This is about what the client is being asked to pay and how the amount is determined.
2. Decide whether the use itself calls for communication
Arizona’s guidance says it identifies no Arizona rule or opinion requiring universal disclosure for any use of AI, while recommending disclosure and informed consent as best practice. California’s guidance takes a circumstances-based approach: a lawyer should evaluate communication obligations in light of the technology, risks, scope of the representation, and the client’s sophistication. Disclosure may be appropriate when AI materially affects decision-making.
Those statements do not establish one nationwide threshold. The more consequential the use, or the more it affects the advice, choices, or risks the client must evaluate, the more important a considered communication decision becomes under the applicable rules. Whether disclosure is required in a particular representation should be checked against controlling local guidance rather than inferred from another state’s approach.
3. Decide what belongs in the engagement letter
Arizona guidance describes written engagement-letter disclosure as a best practice in certain circumstances, including when confidential information will be entered into an AI tool, AI-related costs will be charged, or AI will be used routinely. California advises that fee agreements clearly communicate how fees are calculated and how AI factors into rates and costs. These are jurisdiction-specific recommendations, not proof of a nationwide rule requiring identical AI language in every engagement letter.
A useful written explanation should make the relevant billing arrangement understandable: whether AI-related lawyer time is billed hourly as actual time, whether a separate tool expense may be charged, and how any such cost is determined. If the client’s guidelines require advance approval or prohibit particular tools, the lawyer must account for those terms rather than rely on a general disclosure alone.
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Whether a lawyer may bill for AI work is different from whether the lawyer may submit client information to an AI provider. ABA Formal Opinion 512 emphasizes competence, confidentiality, communication, supervision, and fees. A lawyer using a tool should understand its security, data-retention, and confidentiality arrangements; consent or additional communication may be required depending on the tool and the circumstances.
Before entering client information, the lawyer should consider what data the system receives, how the provider handles it, and whether the proposed use is consistent with confidentiality obligations, client instructions, and any court order. A client’s agreement to an hourly rate or an AI-related cost is not, by itself, authorization to upload confidential material. Nor does a lawyer’s review of generated work remove the need to protect the information supplied to the tool.
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Accuracy is another part of the lawyer’s continuing responsibility. California guidance says lawyers must review AI output, including legal analysis and citations, and remain responsible for court submissions. An AI-generated draft is not ready to file merely because the tool produced it; verification and professional judgment are part of the work the lawyer must perform.
How to assess an AI-related line on a legal bill
A client who wants to understand an AI-related charge can ask focused questions without assuming that every AI use is improper or that every tool cost is recoverable. The answer depends on the type of charge and the terms governing the representation.
- Identify what the line item represents. Ask whether it is lawyer time, a software expense, or another service charge. A time entry and a pass-through expense are assessed differently.
- For hourly work, request the actual activity and time. The description should make it possible to distinguish time spent entering information, reviewing output, checking authorities, correcting a draft, or applying legal judgment from time the tool saved.
- For a separate expense, ask for its basis. Clarify whether the cost was incurred for the specific matter, how the amount was calculated, and where the engagement agreement or applicable billing terms explain it.
- Check the governing documents. Review the engagement letter, any outside-counsel guidelines, client instructions, and relevant court orders for restrictions, approval requirements, or agreed billing methods.
- Ask the lawyer to explain a mismatch. If an hourly entry appears to charge for estimated manual work, or a general subscription appears as a separate client expense, ask how the charge complies with the agreement and the rules that apply in the jurisdiction.
These questions help isolate the issue; they do not determine whether a disputed charge is lawful. A client with an unresolved billing dispute should consult the applicable state bar’s consumer resources or independent counsel familiar with the jurisdiction and engagement.
Which rules control?
ABA Formal Opinion 512 interprets the ABA Model Rules, but state regulators determine which professional-conduct rules govern a lawyer and may issue separate opinions or guidance. The ABA notes that state and local ethics committees may provide updated guidance as tools develop. North Carolina’s 2024 opinion, Arizona’s guidance, and California’s practical guide approved May 14, 2026, illustrate different state-level treatments rather than a single national answer.
For an individual bill, the relevant checks are the lawyer’s jurisdiction, the engagement agreement, the client’s billing instructions, any outside-counsel guidelines, and court orders that apply to the matter. California guidance specifically says applicable client instructions or guidelines restricting AI must be followed. A state example can help frame the questions, but it cannot substitute for the controlling rules where the lawyer practices.
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