In the estate planning process, it’s crucial to name an executor of your estate. This is the person tasked with the administrative tasks that must be done following your death, ensuring that your estate is properly distributed. In most cases, the executor will be a family member, friend, or attorney—someone you know will be trustworthy and responsible.
The executor’s work can sometimes be pretty heavy, so it’s common for people to wonder: should the executor be paid for all this effort? Should the estate plan set aside some funds to reimburse the executor for his or her work?
Determining Executor Fees
The answer can vary from state to state. In the State of California, it is generally agreed that the executor of an estate is entitled to compensation; you should denote this compensation in your estate planning documents. Typically, this number will be expressed as a percentage, not a specific sum; this is because the value of your estate may fluctuate over time.
If you do not denote compensation for your executor, California’s court system might step in to decide how much the executor is paid. This, too, will be a percentage—4.0 percent for the first $100,000 in the estate, 3.0 percent for the next $100,000, and so on.
Paying Your Executor
The work your executor does on your behalf is important—and it can be time-consuming. For many, offering payment is simply an expression of gratitude. Remember, though, that in the State of California, it can also be a legal requirement.
Ensure that your estate plan addresses the question of compensation. For insight into how to structure it, don’t hesitate to reach out to our estate planning attorneys. Contact our team at Singh Law Firm and ask us about executor compensation.
Learn more about estate planning from Singh Law Firm.
