Question: I was named as the Executor in my mother’s Will. Do I receive a fee for serving as Executor of the Estate?
Answer: To begin, it is important to understand the functions of an Executor. The Executor will be required to perform duties which will depend upon, and be specific to, the respective estate. Some of these duties may include: probating the Decedent’s Will, marshalling the Decedent’s assets, managing the Decedent’s property, keeping accurate records with regard to the administration of the Decedent’s assets, paying all valid claims of the Decedent’s creditors, filing the applicable estate tax returns, preparing an estate accounting and making distributions to the Estate’s beneficiaries.
There are certain assets that may be part of the decedent’s gross estate that will not be considered as part of the estate for purposes of calculating the executor’s fee. Examples of such assets include proceeds from a life insurance policy and assets in a 401(k) plan.
In New York, the Executor of an Estate is entitled to executor commissions which are statutory in nature. Under the New York Surrogate’s Court Procedure Act §2307 (“SCPA”), executor fees are based on the value of the probate estate and range between 2% and 5% of the value of applicable assets received and paid out.
Under the SCPA, executor fees are calculated as follows:
(a) For receiving and paying out all sums of money not exceeding $100,000 at the rate of 5%
(b) For receiving and paying out any additional sums not exceeding $200,000 at the rate of 4%
(c) For receiving and paying out any additional sums not exceeding $700,000 at the rate of 3%
(d) For receiving and paying out any additional sums not exceeding $4,000,000 at the rate of 2.5%
(e) For receiving and paying out all sums above $5,000,000 at the rate of 2 percent
Additionally, it is important to note that the Decedent may have decided on an entirely different fee for the Executor in her Last Will and Testament which would supersede the statutory calculation enumerated above.
The process of administering an Estate and serving as an Executor can be complicated and involve a signification amount of work which is why a NYS Executor is entitled to receive a commission. It is important that the fee an Executor charges against the estate is consistent with the Will and statutory requirements. An attorney who specialized in the administration of Estates can assist an Executor in this regard.
– Nancy Burner, Esq. and Maria Johnson, Esq.