Fair price for executing an estate

[lem1955]

My last remaining parent has died. My sister and I are the only beneficiaries of their estate. My father was very well organized so most everything is in a trust. My sister declined to be an executor, so I am the executor. The lawyer says I am entitled to payment for the work involved. What is a fair amount for me to take as payment in either dollars or a percentage of the estate?

 

[MichaelB]

Condolences for your loss.

While you wait for responses you might want to look over this thread from last year asking a similar question. https://www.early-retirement.org/forums/f28/estimated-fee-to-be-an-executor-of-an-estate-115974.html

A few questions that might arise are if you are also trustee for your father’s trust, if that role is compensated, and if the trust defines a compensation rate.

 

[lem1955]

Thanks, Michael B. The previous thread was very helpful. There is a lawyer involved doing all the heavy lifting on the estate. And I have considerably more wealth than my sister. I'm leaning toward taking no fee for the work I'm doing.

 

[Texas Proud]

Thanks, Michael B. The previous thread was very helpful. There is a lawyer involved doing all the heavy lifting on the estate. And I have considerably more wealth than my sister. I'm leaning toward taking no fee for the work I'm doing.

That is an option that is good if you do not have to do work or just want to be nice to your sister..

 

[audreyh1]

I took no compensation even though it was a lot of work. I’m close to my siblings, am the only one retired, and far better off financially.

At the very least you can cover personal expenses related to being executor especially since your sister declined. Beyond that some compensation is still reasonable. But it really comes down to how you feel about it.

 

[MichaelB]

Thanks, Michael B. The previous thread was very helpful. There is a lawyer involved doing all the heavy lifting on the estate. And I have considerably more wealth than my sister. I'm leaning toward taking no fee for the work I'm doing.

Glad the other thread was helpful.

I took no compensation even though it was a lot of work. I’m close to my siblings, am the only one retired, and far better off financially.

At the very least you can cover personal expenses related to being executor especially since your sister declined. Beyond that some compensation is still reasonable. But it really comes down to how you feel about it.

This is similar to my experience, I’m sole trustee for my mother’s irrevocable trust and am designated as executor when that moment arrives. I take no fee and only reimburse out of pocket expenses. I might see it differently if we needed income, but for me it’s more a labor of love and filial duty, and we do have siblings that are in need.

 

[street]

Thanks, Michael B. The previous thread was very helpful. There is a lawyer involved doing all the heavy lifting on the estate. And I have considerably more wealth than my sister. I'm leaning toward taking no fee for the work I'm doing.

That is what I did and also spent about 6 years paying their bills and all business they had each year. I didn't like the job, but someone had to do it.

 

[Walt34]

I took no compensation even though it was a lot of work.

That's what I did too. The will did specify that I would serve without compensation, and I really didn't mind. My sisters and I got along well, and it was sort of "the last thing I could do for Mom". Also, I lived the closest so that greatly simplified a lot of things since I was 20-30 minutes away. One sister was an hour away and the other was two hours away.

My sisters did take me and DW out to dinner after the estate was settled.

 

[swakyaby]

My #2 brother handled executor duties for the 4 beneficiaries of my mother’s estate. He took no compensation even though the time commitment was lengthy dealing with the family home, the banks, 5 financial institutions, the trust lawyer, trust taxes, and multiple letters from the IRS. The IRS finally accepted his version of the trust taxes after 4 years. I felt so badly for him, I sent him a check as a gift, but he said he would not take money from his sister and tore it up. I would not begrudge him being paid for his work, but don’t know how much that would be. He did say he appreciated the sentiment when I discussed with my sibs that he should receive some compensation for his time.

 

[dak2018]

My brother was executor of our parent's estate - he served without compensation, but did have the estate pay for all of his expenses incurred. This was mostly payment for a couple of plane tickets to get him out here to work through the house.

There was quite a bit of work involved, and I am grateful that he did all of that with no thought of compensation, but I would have been equally happy if he had taken some money for the aggravation of dealing with the various financial institutions. Nothing was overly complicated, but the banks sure so throw up some stupid roadblocks by not having uniform procedures at each branch!

In the end we all cooperated, got the job done, and still have good relationships. Mom and Dad would be proud!

 

[Sunset]

My DW was executrix , and I helped her, it was a bunch of work. We did have the estate pay for expenses (legal fees, taxes, various bills, etc).

We didn't take any compensation, as the money was going to siblings.

I know I won't volunteer for this job for anyone other than close family, it's too much effort, form filling, nit picking. etc..

 

[Ronstar]

Sorry for your loss lem. DW is the executor for her mom (still alive). Elder care attorney recommended that DW get paid for elder care activities and executor work when the time comes. We didn't plan on charging a fee and the attorney didn't say what she would recommend.

I would recommend what others have - that the estate pay all executor expenses. That's what I did when my father passed. The expenses can really add up.

 

[Act2]

For one relative where I was not a beneficiary, I had the estate pay all expenses plus I billed my time at $ 35/hr back in 2016-2017.

For another that I am handling now in which I AM a beneficiary along with my two siblings, the estate pays all expenses but I do not take a fee.

 

[Lewis Clark]

The tax implications may be worth considering in some cases when the executor is also a beneficiary.

When my wife was executor for an estate about 12 years ago, the lawyer told her she could charge whatever reasonable number she wanted for her time. Of course, the lawyer would not define "reasonable".

Any money she received from the estate for her time as executor was considered taxable income. Of course, the estate also covered her out of pocket expenses.

Any money she received from the estate as a beneficiary was tax-free.

 

[street]

I might add that taking a fee isn't a bad thing. It is a lot of work, and you can get paid legally so why not. I didn't because I felt I could do it for them for what they did for me.

 

[Jerry1]

. . . I have considerably more wealth than my sister.

. . . you can get paid legally so why not.

Yes, it’s legal and nothing wrong with taking payment. However, payment mathematically comes out of sister’s pocket (half of it). Given that OP has “considerably more than” his sister, I agree with his leaning - to do it at no cost.

 

[Drake3287]

Here's my answer from that link from 2022 post and yes, I had my parents house to both empty out and sell during the beginning of covid in early 2021.


"Having gone through this for over 2 years so far, take every penny you're allowed! You're going to earn every penny of it. At least here in California, there's a set guideline based on the value of the estate including final sale of any real estate.

I took about 50% of what was allowed simply because the lawyer felt it was within reason. Realistically, it wasn't enough but it kept peace in the family. To this day they have no idea how much work was involved. I'm still dealing with the IRS over a $19. refund! It never ends!"

 

[swakyaby]

I took about 50% of what was allowed simply because the lawyer felt it was within reason. Realistically, it wasn't enough but it kept peace in the family. To this day they have no idea how much work was involved. I'm still dealing with the IRS over a $19. refund! It never ends!"

As executor, my brother received a letter from the IRS 4 years after my mother passed, stating that trust taxes were owed, over $90K in taxes, penalties, and interest. The IRS had inexplicably lost track of all the trust taxes paid. So my brother had to dredge up past financial records showing proof of payments. In response, the IRS sent a followup letter saying amount owed is $0.00. It was a good thing because the assets were distributed to the beneficiaries by then, and my brother had held back about $40K in my mother’s bank account with POA account privileges “just in case.” He too expressed frustration that this trust business never ends.

 

[Winemaker]

I didn't charge for my DM's present estate; it's taxable income, and don't need any of that.

 

[EastWest Gal]

I was both POA and Executrix for my dad’s estate and trust. I had a lawyer advise me but I did all the heavy lifting. When everything was broken down into small tasks, it wasn’t that hard.

It made no sense to get paid for my efforts. All that would do would take a small amount of money from my only sister, and give a portion of that to Uncle Sam and the state. And I was employed at the time and at the peak of my income.

 

[ImThinkin2019]

I am trustee and executor of my brother's estate. He was quite well set up, with most things in a trust, but a couple were not. These required that I get approved as the executor by the Court during Covid. This took over 6 months to do.

The Court appointment was needed to transfer the car and one brokerage account. All the other accounts were movable with a death certificate and copy of the trust.

The work I did spanned about 3 years and is still ongoing. All of the money is going to charity.

I took $10,000 as a fee. Checked with the attorney and he said that was very fair.

 

[38Chevy454]

I was executor for parent's estate. I did not take any fee as it was just split equally between the three children. I was fortunate in that parents had a trust, plus I had taken care of many things prior to final parent's death, via POA for financial. I had already sold their house and a partial interest in a rental condo. So once the final estate process started it was pretty simple. Still it does take time and I do not think it is wrong to take a reasonable fee for the work (time) involved. I was the better off of my other two siblings, so I just did it without any compensation. The biggest hassle has been some unexpected money coming in 9-10 years after the estate was created. My advice, keep an estate account open for long past when you think it is all done. Just so you can deal with any long term stuff that pops up. You can keep an account with minimal money in it, like $100 to avoid fees.

 

[Texas Proud]

I read where someone mentioned paying bills etc before death.... I did that for many years without any compensation... and probably will have to do it with my oldest sister at some point...



As for the trust and estate, I took compensation as it was a lot of work to get done... most of my siblings told me to do so... also, even though I am financially good so are all my siblings... heck, 3 of them have great pensions and my brother has a big multiple of what I have... there is only one sister who is not as well off but even she bought a second house up north recently so not that bad off...

 

[badatmath]

I looked to see if there were any guidelines on this and found a link: https://executor.org/resource/executor-fees-by-state/.

Not sure how I feel about it or if I would take compensation. I think it would depend how much work it was and the relationship I was in with the deceased and so on. I do think expenses should be paid if you incur any.

 

[Pluperfect]

I looked to see if there were any guidelines on this and found a link: https://executor.org/resource/executor-fees-by-state/.

From that site: "Executor compensation in Texas is typically 5%." Uh, 5% of what?