Question: Should an executor of an estate be compensated? And, how much?

Tidybuoy · 09-01-2017, 07:32 AM

I'm setting up a trust/will and I'm wondering if it is standard procedure to leave an amount to my executor. And, what is a reasonable amount? I was thinking 5% of my estate but I want to be fair and within reason.

I was co-executor of an estate several years ago and nothing was spelled out very well (including the normal will). This made it very difficult as family members showed up out of nowhere and me (non-family) had to make decisions that were difficult. I'm hoping to avoid this type of situation with my own estate.

I don't have kids so my estate if being left to my siblings and will be very easy but I do want to be fair to my executor. My trust is all done but now is the time to make any changes before it is finalized by the lawyer.

Thanks in advance for all advice.

drcoastline · 09-01-2017, 07:36 AM

5% is generous especially if not complicated to probate. I just was involved in setting up my mothers and 1% was the factor recommended by the attorney.

looneybin · 09-01-2017, 07:53 AM

DIBS on your '74
all kidding aside - if your executor has to come in from out of town, or if there is multiple assets that are being fought over, that take a lot of time to disburse, then it's not unreasonable to do 2 or 3%
also depends if you are talking 50K or 50M, then the % is a sliding scale

ossiblue · 09-01-2017, 08:03 AM

Agree with the above posts that compensation will depend, to a large part, on the complexity of the estate and who is named as executor. You could very easily name one of your siblings as executor even though they will share in the estate. If you are on good terms and wish to discuss the details beforehand, that would make things very easy. In such cases, compensation may not be necessary.

There are so many variables in this situation that it is difficult to lay down rigid rules. If you want to keep things "clean" from family disputes, then appointing a third party, outside of the family, as executor is certainly the way to go. If so, then compensation is warranted, IMO. The amount, as mentioned by others, will depend on the appointee and the the complexity of the estate.

MBAtarga · 05:58 PM

In GA, my understanding is a 1% fee is allowed to be charged by the executor.

Edit: I had been on the phone with our attorney for updates to our (wife and I) wills, which includes some changes to establishment of trusts for each of our (adult) kids. He mentioned if we chose an institutional trustee, the normal admin fee for an advisor would be 1%. That is what was in my brain when I replied above. Consider it a brain fart that I was associating trustee to executor.

LakeCleElum · 09-01-2017, 09:54 AM

I'm currently executor for my mothers estate. Liquidating her assets and distribute to us 5 kids...No provision for paying me me, BUT: Attorney insists I track my time and pay myself at the end. I told her I don't really want paid, attorney acts like the court will almost insist I do this to close the estate in the end?......

How much do I charge is the question? In my retirement job, I get paid $250 every time the phone rings?? I'd be happy with a straight $20/hr.

Laws on this very from state to state....Maybe MRM will chime in, he knows this.

Bob Kontak · Bob Kontak's Garage

Quote:

Originally Posted by MBAtarga

In GA, my understanding is a 1% fee is allowed to be charged by the executor.

Not arguing as I find this interesting and have heard percentages as high as 15%.

Says in this link that Georgia allows 2 1/2% for all money coming into an estate and 2 1/2% for all money distributed.

Odd one is 3% on real-estate if you petition the court. So you set up the sale. Sweep the floors, paint the walls and prepare it for sale. Realtor gets their 7 1/2% and then you have to ask the court for your 3%.

From other sites, out of pocket $ and mileage is directly reimbursable. So you get the $4.50 back for the Murphy's oil soap but the three lost weekends scrubbing...............

Is it true that Georgia probate law says an executor gets paid by the estate? How much?

Seahawk · 09-01-2017, 10:41 AM

I was the Executor of my Dad's estate. We worked everything out in advance so it was very neat and tidy. The Will was very explicit and everyone knew what was in it in advance.

I waived all compensation except actual expenses. He insisted on an hourly fee as did the lawyer. I worked for $25 an hour. It took me, even with everything well laid out in advance, nearly a hundred hours to get everything exactly right.

My wife is the Executor on her mother's estate. The lawyer recommend a 2.5% fee plus actual expenses since this one won't be so neat and tidy.

So, in my limited sample size, it seems Executor compensation is negotiable.

Rick Lee · Rick Lee's Garage

If my folks go at the same time, I would definitely have to quit my job and move across the country for a good 6-12 mos to deal with the estate. I couldn't afford to do that without compensation.

Tidybuoy · 09-01-2017, 11:16 AM

Thanks for all the advice.

I looked up the rules for CA (didn't know they had rules):
4% on first $100,000
3% on next $100,000
2% on next $800,000
1% on next $9,000,000
It goes on but will never apply to me.

This calcs out to 2.3% on the first Mil. I doubt I would have more that that left over after my extremely lavish retirement period

I am going to state in my trust that the executor will be paid 3%.

Lastly.....Brent,
I going to be buried in my '74....sorry.

MBAtarga · 09-01-2017, 01:14 PM

Where is your grave sight?

GWN7 · 09-01-2017, 01:30 PM

3% Up here. My sister & I were co-executors. That is they can charge that much. Doesn't mean they have to.

looneybin · 09-01-2017, 03:31 PM

Quote:

Originally Posted by MBAtarga

Where is your grave sight?

That's what I was thinking
Hose it out, a little fabreeze, should be GTG

john70t · 09-01-2017, 04:35 PM

Quote:

Originally Posted by Tidybuoy

I doubt I would have more that that left over after my extremely lavish retirement period

You need go out with an instant heart attack, a line of coke thick as your arm on the dash, in a convertible Ferrari, doubleD blond hooker given ya the knobbin, doing at least a buck through the city. Yeehaw!

NoRush993/951 · 09-01-2017, 05:20 PM

My attorney said a yearly amount of $13k was acceptable. If it took two years or more to settle, then every year created another payment.

Otter74 · 09-02-2017, 05:42 PM

I was the executor of my dad's estate. It was pretty simple as far as estates go, but was still a lot of work. I kept track of all my expenses - legal stuff, costs for trips between Detroit and Atlanta to take care of stuff, etc. then when I distributed it between my sister and me, I forgot to pay myself. Whoops! It never occurred to me to even look into whenther I might be paid for my work. It was just something I had to do.

Charles Freeborn · Charles Freeborn's Garage

If I'm not mistaken in CA it's 10%. Not sure if that's before expenses (all executor costs - air fare, hotels, meals , etc.) or not.
Ask the trust lawyers - they'll know, but no matter what keep ALL receipts...
My mom is 94 so that's looming for us too...