New York Estate Fees Commission
The executor of an estate is the person responsible for winding up the affairs of the decedent. This means that the executor is responsible for managing the assets of the estate, making disbursements where appropriate, and ultimately for making distributions to the beneficiaries who were named in the will according to the terms of the will. The job of an executor is not always easy. Depending on the size of the estate, the family dynamic and unexpected complications such as estate litigation, managing an estate can be challenging and time-consuming. In fact, while probating many estates takes 1-2 years, in other cases it takes well over 2 years to close an estate. Because of all of the details involved in winding up an estate, New York law allows executors to charge a reasonable fee or commission for performing estate executor services. If you are an executor of an estate, or if you are in the process of making a will, and you have concerns about executor fees, contact an experienced New York Estate Fees Lawyer who will explain to you the duties and responsibilities of an executor and how executor fees are determined.Fee Calculation
Executor fees must be reasonable. In general, they are calculated using one of three methods.
Terms of Will. In some cases the testator will include in the terms of his or her will the fee that the executor is to be paid. For example, the will may state a specific percentage of the estate assets that the executor is to be paid, or that the executor is to be paid a flat amount. If the executor is also a beneficiary, the testator may specify that that executor is to be paid nothing or a minimal amount.
Statutory Fees. Under New York Surrogate's Court Procedure section 2307 executor fees are based on the value of the estate that is subject to probate, and range from 2 to 5%. To determine the basis for the fee the court will look at the amount of money that the estate receives and disburses while under the control of the executor. Under the Surrogate's Court's rules, executor fees are calculated as follows:
- If the estate receives and pays out money not exceeding $100,000, the executor fee is 5% of that amount
- If the estate receives and pays out additional money not exceeding $200,000, the executor fee is 4% of that amount
- If the estate receives and pays out additional money not exceeding $700,000, the executor fee is 3% of that amount
- If the estate receives and pays out additional money not exceeding $4,000,000, the executor fee is 2.5% of that amount
- If the estate receives and pays out money above $5,000,000, the executor fee is 2% of that amount
If there is more than one executor, then the fees are to be apportioned among the executors based on the services rendered by each executor.
Fee Schedule. The rules for corporate executors are a little different and may be based on the corporation's fee schedule. However, in order for the corporation's fee schedule to be used, the testator must have mentioned in the will that the executor is to be paid according to the corporation's published fee schedule. Typically a corporation's fees as stated in its fee schedule for executor services is more than the statutory fees.
The value of the probate estate is $1,000,000. The will is silent on the subject of executor fees. The fee would be calculated as follows:
$100,000 x 5% = 5,000
$200,000 x 4% = 8,000
$700,000 x 3% = 21,000
The executor's fee would be $34,000
The value of the probate estate is $50,000. The will is silent on the subject of executor fees. The fee would be calculated as follows:
$50,000 x 5% = 2,500
The executor's fee would be $2,500
Because of the work involved in serving as an executor, executors are entitled to payment. However, it is important that the payment is consistent with the statutory fee schedule, the terms of the will, or otherwise reasonable. Furthermore, it is also important that the executor fulfill his or her duties with the utmost care. If you have concerns about executor fees or responsibilities, contact an experienced estate attorney. The staff at Stephen Bilkis & Associates, PLLC has extensive estate planning experience and frequently represents clients before the New York Surrogate's Court. Contact us at 1.800.NY.NY.LAW (1.800.696.9529) to schedule a free, no obligation consultation regarding your estate matter. We serve individuals throughout the following locations: