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My husband and I are writing a new will. We are naming our niece the Executrix. We only have one property and a couple accounts. One daughter and one grandson. It's not very involved.
My question: What should I pay her to oversee things when we're gone?? She is not actually an heir, so I want to make sure she gets something for her efforts.
My husband and I are writing a new will. We are naming our niece the Executrix. We only have one property and a couple accounts. One daughter and one grandson. It's not very involved.
My question: What should I pay her to oversee things when we're gone?? She is not actually an heir, so I want to make sure she gets something for her efforts.
Yes, you want her to do it for free and not be an heir and your daughter will be? She I assume is the choice because of skill and should be compensated as a result.
Yes, you want her to do it for free and not be an heir and your daughter will be? She I assume is the choice because of skill and should be compensated as a result.
Exactly. I can trust her. I could name my grandson, but that would surely cause bad feelings. I'm just not sure what is the appropriate amount. There shouldn't be any outstanding debt that she'll be responsible for and the will states exactly who gets what. I just want to make sure our wishes are carried out.
You should check with an attorney to see if your state sets guidelines for the compensation for an executor/executrix. Many do. I know that both NY and NJ do.
The compensation rate is based on percentages, and in some states (such as NJ) it is on a sliding scale that depends on both the total value of the estate and on any income that the estate earns while it is being probated.
Note also the end paragraphs that explain that the compensation that the executor gets is considered as earned income and he/she will have to pay income taxes on it.
ETA again (sorry, LOL): Here is a page explaining how Oregon does it. As you can see, it's more straightforward than NJ's but it is still a percentage based on the value of the estate. http://www.oregonwillstrustsprobate....ecutor-fees-2/
You should check with an attorney to see if your state sets guidelines for the compensation for an executor/executrix. Many do. I know that both NY and NJ do.
The compensation rate is based on percentages, and in some states (such as NJ) it is on a sliding scale that depends on both the total value of the estate and on any income that the estate earns while it is being probated.
Note also the end paragraphs that explain that the compensation that the executor gets is considered as earned income and he/she will have to pay income taxes on it.
ETA again (sorry, LOL): Here is a page explaining how Oregon does it. As you can see, it's more straightforward than NJ's but it is still a percentage based on the value of the estate. EXECUTOR FEES
Realize as indicated in the provided link provided by stressedout the commission is optional and taxable. So as suggested your niece may be better off being in the will and not taxed.
Realize as indicated in the provided link provided by stressedout the commission is optional and taxable. So as suggested your niece may be better off being in the will and not taxed.
I didn't read that it was optional. If that's the case, I would like to leave her a lump some for her efforts, then it wouldn't be taxable.
Oregon has a "transfer on death deed" that we can use for our house and bank accounts. We don't have a large estate, but the house is paid for.
I just want someone to facilitate things when we're gone. I'm not even sure if executor is the correct term.
I didn't read that it was optional. If that's the case, I would like to leave her a lump some for her efforts, then it wouldn't be taxable.
Oregon has a "transfer on death deed" that we can use for our house and bank accounts. We don't have a large estate, but the house is paid for.
I just want someone to facilitate things when we're gone. I'm not even sure if executor is the correct term.
Hm... a question, then, if you don't mind: In your will, is one of your heirs named as executor? Somewhere in the will, an executor (or executrix, if it's a female) must be named. In that case, that person (whoever you named) will be entitled to an executor's commission.
Under normal circumstances, when a couple makes a will the surviving spouse is named as executor but a good lawyer will always suggest that a backup executor be named in case the couple "meets death in a common accident" or if the surviving spouse is "unwilling or unable to act as executor".
The executor will need to take care of such things as obtaining the death certificate(s), presenting them to your bank(s) or brokerage company with a request for a statement showing your total assets held by them on the date of death, contacting credit card companies to cancel cards, getting a realtor to appraise your house for its market value as of date of death, valuing your car(s), etc. and submitting whatever paperwork your jurisdiction requires for probate.
Executors don't get paid for non-legal things such as distribution of personal effects that are not mentioned in the will, although any expenses that the estate incurs before the end of probate (such as maintenance of the house before it's legally transferred to your heirs) are normally paid out of the estate funds by the executor.
I was once advised by an attorney to never list personal effects (jewelry, art, etc) specifically in a will, because if they are there they must be valued and that value will be added to the taxable estate. It's much better to write a separate letter stating who gets what, and give it to someone you trust to carry out your wishes. Whether that someone is your executor or someone else, is up to you. It's kind of a catch-22: If you want to be absolutely 100% certain that Griselda will get your great-grandfather's antique Victorian sterling silver spittoon, for example, then say so in the will; but then the spittoon will have to be appraised, its value added to the estate, and possibly taxed depending on what your state's inheritance tax laws are.
Sorry if this is TMI, lol, but so far in my life I've had to handle three different estate situations, one of which was for someone who died without a will. That one was a 2 1/2 year paperwork pain in the posterior, LOL
Even with a will, probating an estate is a pain in the neck. There is mounds of paperwork.
You have to be buried, cremated, etc. Your executor has to deal with you. Lay out your plans for that now and how it will be paid.
The estate has to have its assets and debits found, tallied and reported to the probate court.
The house has to be appraised. Then it has to be maintained while it is being cleared out, ( utilities to be paid, taxes to be paid, lawn maintained, insurance paid, excess furniture sold or donated, etc. ) Then it has to be sold. Some one has to deal with the real estate agents, offers for sale, home inspections, possible repairs, a closing.
What you asking of the person doing all of this is a lot of time & effort . You'll also need to make sure that there is money available to the executor (executrix). Funerals cost a fortune, appraisals cost money as do the myriad of things needed to keep the house maintained and put on the market. Yes, ideally the estate will pay them. However, no one is going to work for the executor if they hear that they won't get paid for months and months until the estate is settled.
When a child is the executor of a parent's estate, often there is a joint checking account/ joint bank accounts already in place as the child has been helping write out checks for some time. However, in your case, you're not having any financial dealing with your executor until death. Don't expect them to pay for things out of their own pocket. It's just not done. Figure this out now.
To answer question, should your executor get paid ? You better believe it. 5% of the total value of the estate would be typical in cases I have seen.
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