Part of making out a will is appointing an individual to serve as executor, and today we will take a closer look at the executor of estate fees.
As we?ve mentioned in previous blogs, being an executor is a job, and it?s a job not to be taken lightly. Serving as an executor is an honor, but it also requires a significant amount of work over what could be a significant amount of time. There are assets to inventory and secure, bills and taxes to be paid, beneficiaries to accommodate and much more. That being said, it makes sense that executors are entitled to be paid a reasonable fee for their service.?
What are executor of estate fees?
By law, executors are entitled to receive a fee for the work they do. Laws, and fees, will vary from state to state, but fees usually range between 2 and 5 percent of the total amount of the estate.
Since The Olear Team is located in New York State, let?s use the fees set by New York Surrogate’s Court as an example:
- For receiving and paying out money from the estate not exceeding $100,000, the executor fee is 5 percent.
- For receiving and paying out money from the estate not exceeding $200,000, the executor fee is 4 percent.
- For receiving and paying out money from the estate not exceeding $700,000, the executor fee is 3 percent.
- For receiving and paying out money from the estate not exceeding $4 million, the executor fee is 2.5 percent.
- For receiving and paying out sums exceeding $5 million, the executor fee is 2 percent.
Additionally, the executor should be aware that there are certain assets that may be part of the estate that are not considered when calculating the executor’s fee. For example, these assets may include proceeds from a life insurance policy, assets in a 401(k) plan and more. An experienced estate attorney can fill you in on these important details.
When will the executor receive payment for his or her services? The executor can expect payment after the estate’s bills are paid and before the estate is distributed to the beneficiaries.
It is also important to understand that the fee paid to an executor is indeed taxable. Again, the best advice to ensure success is to work with an experienced estate attorney and/or professional realty group such as The Olear Team.
Do you have additional questions on – Executor of estate fees: How much is paid, and when??Learn about the Olear Team’s specialized program for assisting executors and those with power of attorney.