Being named as an executor in Florida requires an adherence to fiduciary duty and completion of what can be a long list of tasks. Even though most people select a friend or family member to play this role rather than a professional such as a bank or a lawyer, under Fla. Stat. § 732.617 an executor is entitled to compensation given the length and complexity of tasks they do in closing out an estate.
A person who serves in the role of executor plays an important role in an estate and therefore, should be compensated for their efforts. This is known as Florida executor compensation. The support of a Florida executor compensation attorney can be instrumental in helping you decide how much compensation an attorney should receive.
Statutory Compensation in Florida
This is not an open-ended opportunity for an executor to charge as much as they want. In fact, existing Florida statutes that can be explained to you by an executor compensation lawyer in Florida explain that the executor compensation is aligned directly with the gross value of the administered estate. This is calculated before any debts or obligations are considered and any income that the estate earns during the probate period is also excluded. Under Fla. Stat. § 732.617(2) this is calculated as:
- 3% fees for the first $1 million in the estate.
- 2.5% fees on the next $4 million in the estate.
- 2.0% on the next $5 million in the estate.
- 1.5% fees for anything additional.
When determining these calculations as a Florida executor compensation attorney can tell you, life insurance policies and 401(k)s in addition to any other assets that would pass directly to beneficiaries are not included in the calculations. There are certain exceptions that can apply to this type of compensation. For example, if the will specifies that a different kind of executor compensation is to apply, the executor has the ability to renounce that specific request and be compensated under the normal Florida statutes. Anytime that an executor is involved in providing extraordinary services, such as the sale of personal or real property, performing legal services on their own, handling tax audits, putting together tax returns, running a business or dealing with complex property issues like a protected homestead, this means that the executor is entitled to further compensation. Florida statutes 733.617 fully explains the rules for executor compensation and it is important to hire an experienced and knowledgeable lawyer in Florida to assist you with this because special compensation rules apply if there are multiple executors. Identifying your responsibilities as an executor and understanding what this means for you is important when stepping into the role. If you are thinking about appointing an executor, make sure they are clear about their responsibilities as well as their ability to charge for compensation. Typical formal probate administration in Florida takes between 6 to 9 months in most circumstances. This includes the appointment of the executor of the personal representative and a 90-day creditor’s period that has to apply to allow the creditors to be notified about the party’s death and be able to come forward with a claim. In the event that the executor believes they are entitled to extraordinary fees, they are responsible for petitioning the court to do so. Additional fees and compensation are usually eligible for more complex concerns like involvement in tax proceedings and are typically paid hourly. However, alternative arrangements are not specifically barred by Florida law. In the event that you wish to obtain extraordinary compensation for your role, you will need to petition the court.
Adjusting Personal Representative Fees
Petitions filed by an interested party can also allow a personal representative or executor’s fee in Florida to be adjusted downwards or upwards based on a number of criteria, including:
- Delays in payment of the compensation after services were completed.
- Benefits or detriments resulting to the estate.
- Responsibilities or liabilities assumed by the executor.
- The efficiency, skill and promise with the way administration is handled.
- Personal representative’s participation in tax planning.
- The complexity or the simplicity of the administration.
Two personal representatives or executors are also eligible to be paid in full personal representative commission if the estate is valued at $100,000 or more. For more information about this process, schedule a consultation with a law firm.