What Fee Can an Executor or Personal Representative Charge?
As a named trustee, I believe my duties will be to liquidate property and other assets, file final taxes, and distribute the estates funds to the beneficiaries. If so, I am looking for guidance on a reasonable fee that should be charged to final out the estate. The trust is in Virginia.
It sounds like you’re talking about serving as executor or personal representative as well as trustee. I can’t comment on Virginia in particular, and a lot can depend on the size of the estate, how much work is involved, and what other costs there may be, such as for legal and accounting fees. A good rule of thumb would be 1.5% of estate assets. But this could well be low for a small estate or high for a large one. I would also recommend keeping track of your time in case you ever need to justify your fee and if using your time to calculate what you’re due, err on the side of a low hourly rate. For instance, you can’t charge a professional rate as a dentist for work cleaning out an attic when you could have hired someone else to do it for minimum wage.
Some states have statutory fees. One is New York, which is much more generous than what I suggest above with the following fee schedule:
- First $100,000 is 5%
- Next $200,000 is 4%
- Next $700,000 is 3%
- Next $4,000,000 is 2.5%
- Remaining amounts greater than $5,000,000 is 2%
In short, a reasonable charge depends on the circumstances and local practice. A Virginia estate attorney can advise you on what is customary there.
Reimbursement, Compensation, and Fees
Executor Fees by State
Can a Trustee be Paid as a Gift and Not Incur Income Taxes?
What Can Attorney Trustees Charge for Closing Out a Trust?
Is a Trustee Entitled to Compensation?
What May a Family Trustee Charge for a Very Simple Trust?
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