Is the Executor of My Estate Entitled to Compensation?

A personal representative (or executor) is the person charged with overseeing the administration of your probate estate. This is often a family member, but it can also be your attorney or even a professional fiduciary. Regardless of whom you appoint as your personal representative, you should be aware of how Florida law provides for compensating such individuals for their services.

Calculating a Personal Representative’s Commission

Section 733.617 of the Florida Statutes establishes the basic schedule for compensation of personal representatives. Compensation is typically in the form of a commission taken as a percentage of the estate’s assets. For estates worth $1 million or less, the commission is 3 percent. So if you leave a probate estate with assets valued at $100,000, your personal representative would be entitled to a commission of $3,000.

For estates worth more than $1 million, the commission is 3 percent of the first million (or $30,000) plus an overage amount calculated as follows:

• 5 percent for estates worth more than $1 million but less than $5 million; plus
• 2 percent for estates worth more than $5 million but less than $10 million; plus
• 5 percent for estates worth more than $10 million.

In other words, let’s say you leave an estate worth $10 million instead of $1 million. Your personal representative’s commission would then be $230,000. This represents the sum of 3 percent of the first $1 million ($30,000), plus 2.5 percent of the next $4 million ($100,000), plus 2 percent of the remaining $5 million ($100,000).

The personal representative may also ask the probate court for additional compensation beyond the commission if any of the following “extraordinary services” are required:

• the estate needed to sell the decedent’s real or personal property;
• the estate was involved in litigation;
• the estate needed to carry on the decedent’s business;
• the estate had to deal with a “protected homestead”; or
• the personal representative had to perform any other necessary “special services.”

Can You Modify the Personal Representative’s Compensation in Your Will?

Florida law does permit individuals to specify other criteria for compensating a personal representative in their last will and testament. However, unless you have a written contract that says otherwise, the executor may choose to “renounce” the provisions of your will and elect to take compensation as provided in Section 733.617. The personal representative may also decline all or part of their compensation.

You might be wondering how compensation works if you place all of your assets into a Florida trust to avoid probate. Generally, you are free to specify whatever compensation terms you like with respect to a trustee. If you make no such provision, then Section 736.0708 of the Florida States states a trustee “is entitled to compensation that is reasonable under the circumstances.” A judge may also modify the terms of compensation under certain circumstances.

Compensating your personal representative or trustee is just one of many details to consider as part of your overall estate plan. If you need assistance from a qualified Fort Myers estate planning lawyer, contact the Kuhn Law Firm, P.A., today at 239-333-4529, to schedule a free consultation with a member of our team today.

Resources:

leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0700-0799/0733/Sections/0733.617.html

leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&Search_String=&URL=0700-0799/0736/Sections/0736.0708.html