Executors Fees in the State of Pennsylvania
Who is entitled to an exeutor's fee?Anyone actually serving as an executor. When more than one party serves, the executors fee does not increase and must be divided between or among the executors. Executors can pay others to do work that an executor might do - such as an accountant to keep records. But, unless the will specifies that they can do this without a diminishing fee, the fees can be reduced. Of course, executors can hire people to do things necessary to the estate - such as cleaning, security, and anything needed to preserve the estate without their fees being diminished.
What can an executor be paid?Pennsylvania executors fees are a matter within the discretion of the Orphan's court judge. In some states, executors' fees are set by statute. However, in Pennsylvania the fees of an executor are subject to review by the court and must be reasonable.
Some firms review each estate, and the particular tasks to be performed and which tasks will be performed by the executor, accountants and others, and to set a flat fee at the outset of the representation.
However, many firms charge on an hourly basis.
The final way of charging is according to fee guidelines as established by the court in The Johnson Estate. This is a fee schedule that reduces the percentage
More on the guidelines to follow.
What should I know about each way of billing?Flat Fee - The advantage is that you negotiate and know the fee up front. You're not billed for calls and time and, you can often reduce the fee if you are willing to perform tasks ordinarily done by the lawyer or paralegals.
Hourly Fees - You're never quite sure how much it will be an may be hesitant to ask questions that are important. Get a quote in advance and the rates for paralegals, partners and associates and ask to be billed or for a report monthly.
Fee Guidelines - You know what the fee will be when you know the estate assets. This may be too high for a very simple estate or one with fewer beneficiaries or simple assets.
What are the fee guidlines?Johnson Estate, 4 Fid.Rep.2d 6, 8 (1983)
EXECUTOR COMMISSIONS Per Col. Per Total
$ 00.01 to $ 100,000.00 5% 5,000.00 5,000.00
$ 100,000.01 to $ 200,000.00 4% 4,000.00 9,000.00
Executor or $ 200,000.01 to $ 1,000,000.00 3% 24,000.00 33,000.00
Administrator $ 1,000,000.01 to $ 2,000,000.00 2% 20,000.00 53,000.00
$ 2,000,000.01 to $ 3,000,000.00 1A 1/2 % 15,000.00 68,000.00
$ 3,000,000.01 to $ 4,000,000.00 1% 10,000.00 78,000.00
$ 4,000,000.01 to $ 5,000,000.00 A 1/2 % 5,000.00 83,000.00
1% Joint Accounts 1% P.O.D. Bonds 1% Trust Funds
3% Real Estate Converted
with Aid of Broker 5% Real Estate:
Non-Converted 1% Real Estate:
$ 00.01 to $ 25,000.00 7% 1,750.00 1,750.00
$ 25,000.01 to $ 50,000.00 6% 1,500.00 3,250.00
$ 50,000.01 to $ 100,000.00 5% 2,500.00 5,750.00
Can fees be challenged?Yes. Beneficiaries can ask the court to review fees that seem too high. But, the attorney general's office and the Pennsylvania Department of Revenue can also disallow the deduction of excessive fees. See http://www.paestateplanners.com/blog/executors-fees-in-pennsylvania-why-are-they-being-cut-and-by-whom.cfm