Does Executor of Estate Get Paid? Understanding the Basics
Does executor of estate get paid? Explore guidelines on executor compensation, legal rights, and estate administration’s payment process.
How Are Probate Executor Fees Paid?
The estate executor or administrator position is a tasking one, as many responsibilities are attached to the role. They initiate the probate process, inventory and value the decedent’s assets, collect debts owed to the estate, settle estate creditors, and distribute the assets to beneficiaries.
Given their numerous duties, including those mentioned above, one may wonder, ‘does the executor get paid from the estate, or is the role of a gratuitous nature?’
According to Nevada probate laws, an executor or personal representative is entitled to receive reasonable compensation from the probate estate for performing their duties. The specific amount to which they are entitled is determined by state law. However, if the decedent makes a provision to that effect in their will, the amount stated in the will would be the full payment for the executor’s services unless they decide to waive compensation.
Suppose you have been appointed executor over a deceased person’s estate, or you’re obtaining probate over your family member’s estate. In that case, the information provided here on how much compensation an executor should receive in Nevada can help you set clear remuneration expectations. Keep reading to learn more.
General Fee Schedule for the Payment of Executors in Nevada
Nevada law provides that an executor be reimbursed for all the money they spend administering and settling the decedent’s estate. It prescribes the following rate of payment depending on the estate’s value after making payments on any liens or encumbrances;
For the first $15,000 of the estate value, the executor should receive payment at the rate of 4 percent.
For the next $85,000 of the estate value, the executor should receive payment at the rate of 3 percent.
For all estates valued above $100,000, the executor should receive payment at the rate of 2 percent.
If there are multiple executors, the court will share the fees among them according to each individual’s extent of service. Also, where it determines that the statutory fees would be insufficient to compensate the executor reasonably, the court can approve a reasonable fee for the executor in addition to the statutory fees.
The probate court can also approve just and reasonable compensation for extraordinary services performed by the executor in administering the decedent’s estate. Such services may include:
Managing the estate assets.
Dealing with complex tax disputes.
Defending the estate in litigation claims.
Running the deceased’s business following an order of the probate judge.
What Happens When an Attorney Serves as an Executor?
Under Nevada state law, an attorney who serves as the executor of the will may receive payment for their services as an attorney or an executor but not for both roles unless the court decides otherwise. The court can make such an order for multiple compensations if it approves of a different compensation method in advance, perhaps due to the complex nature of the estate or because it benefits the estate.
However, this does not prevent an attorney/executor from getting paid for other services performed by affiliates, associates, or partners of the attorney from the same law firm on behalf of the estate. In such a case, the court must determine that the compensation is reasonable and in line with the services provided.
How Do Corporate Executors Get Paid?
Sometimes, a decedent may nominate a corporation as executor. However, Nevada law does not provide a separate compensation structure for such corporations. As such, they get paid the same way that individual executors would.
However, where the institution proposes an amount higher than the statutory rate or enters a contract for higher compensation with an heir to the estate, such contract is void by law. If the institution has an internal fee schedule for taking on the duties of an executor, they might need to seek the advance approval of the court at the initial stage of the probate proceedings.
Can an Executor Waive Their Right to Receive Compensation From the Estate?
In most cases, one is entitled to receive payment for serving as executor. However, some may be uncomfortable with collecting payment if they are family members of the decedent and refuse payment.
The law allows an executor to waive their claim to compensation where the same is provided for in the will. The renunciation must be in writing and filed in the probate court within 60 days of the person’s appointment as an executor.
While a renunciation may seem noble, it is a serious decision that should be carefully considered. The job of an executor is tasking, and an executor who opts to perform their duties gratuitously may find themselves worn out before the probate process ends.
That said, there are circumstances where it is more logical to waive executor compensation than to receive it. One such instance is where the executor is an heir to the estate. Tax-wise, an executor’s compensation is generally categorized under taxable income, whereas inheritance is not.
If you will still receive the money or estate via inheritance, accepting an executor’s fee may not make sense.
When Does an Executor Get Paid?
The executor fee is typically paid after the estate settlement process is complete. This is because some factors that will influence the exact amount the executor is to be paid can only be determined once the estate is closed. Some factors include the extraordinary services provided, if any, or the extent of services each executor offers where there is more than one.
However, probate cases, especially of complex estates, could take a while to resolve. So, the law allows an executor to request an advance allowance from their fees after their appointment once all the necessary parties have been notified.
Settling an Estate is No Small Task; Get Professional Assistance
While most executors are entitled to payment for their services by law, some complexities in settling an estate may call for professional help. Seeking guidance from an experienced attorney can help you navigate the probate process with relative ease while ensuring that all legal requirements are met.
With the proper assistance, you can efficiently complete your duties as an executor and ensure the decedent’s final wishes are honored.
So, if you have been nominated as an executor or need help with estate planning matters in Nevada, consult a reputable attorney today. Your future self will thank you for it!
How Can a Probate Lawyer Help?
Being an executor is a lot of work and could be daunting for many people. There are several legal responsibilities, documents to file, and deadlines to meet. Unless one has a lot of experience as an estate executor, it might be impossible to scale through the entire process without the support of trained probate professionals.
If you’ve been appointed executor and are unsure how to proceed, consider contacting an experienced probate lawyer for guidance and representation.
With their knowledge of the extensive rules surrounding the probate process, your attorney can help you carry out your duties effectively. Your attorney, in this case, represents your interests, and they can also advise you on whether to accept compensation, the manner of payment you can receive, and receiving compensation for extraordinary services.
Having an attorney represent you during your time as an executor can help to simplify things for you. Consider contacting one as soon as possible.
If you have further questions about the probate process or need to speak with an estate planning attorney in Las Vegas, contact us at Wood Law Group to set up a free consultation. We’d gladly answer your questions, assess your case, and represent you where possible.