Does the Executor Get Paid From the Estate?

How Are Probate Executor Fees Paid?

The position of an estate executor or administrator 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 the performance of 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.

If you have been appointed as an executor over a deceased person’s estate or you’re in the process of obtaining probate over the estate of your family member, 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 reasonably compensate the executor, the court can approve a reasonable fee for the executor in addition to the statutory fees.

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.

Can an Executor Waive Their Right to Receive Compensation From the Estate?

In most cases, one is well within their rights 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 is required to be in writing and should be 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 are still going to receive the money or estate via inheritance, it may not make sense to accept an executor’s fee.

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 of these 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.