Payment When Acting As Executor / Personal Representative
What is Fair Pay for Executor Fees?
As the executor of an estate, you take on a lot of responsibility and work. In Alberta, while now called personal representatives, most people still use the term executor. Much of this work can be quite stressful, and require you to invest a lot of time and resources into your efforts. Learn more about executor responsibilities here. It is only logical that you should receive compensation for your time and labor. Thankfully, executor fees can provide this compensation. The estate lawyers at Kahane Law Office in Calgary, Alberta can help if you need more information. 403-225-8810
The idea of compensation for the executors of wills is typically considered common sense and beneficiaries accept them as part of the costs to the estate. Executor fees are part of dealing with an estate. People frequently refer to executor fees as executor pay. The waters become a bit murkier when it comes to determining what amount should come out of the estate to cover the executor fees. There are many ways to come to a solution.
The Will May Stipulate Details Regarding Executor Fees
In some cases, the deceased specifies in the will how much the executor will receive as executor fees. The executor’s entitlement to in the form of compensation for work provided maximizes in this amount. They will likely receive the full amount as executor fees detailed in the will, unless the will is disputed, and the assets are tied up in lawsuits in the Alberta Courts.
How To Proceed When The Will Does Not Designate Executor Fees
It is not unusual for the deceased not to mention executor fees in the will. This leaves the decision for the amount of executor fees up to the executor of the estate. The amount of compensation received by the representative of the estate can be based on:
- The size of the estate and the complexity of the responsibilities;
- The amount of time spent by the executor; and lastly
- Whether or not the executor had the assistance of a probate lawyer.
If multiple executors worked together, a total amount of executor fees is first determined. Next, each executor receives their divided share of the total compensation. The total amount of the executor fees is generally determined around the time that the executor begins releasing assets to the beneficiaries.
The executor(s) will devise a proposed plan for distributing the assets to beneficiaries, paying the estate’s debts, and paying executor fees. The residuary beneficiaries will have a chance to view this proposal and provide their approval regarding the proposed compensation.
According to Estate Law Canada, most provinces and territories do not have specific guidelines regarding limits on these fees. The laws in most areas simply stipulate that the fees must be “fair and reasonable”. Alberta estate law differs in this respect. Executors in this province must keep their fees between 1 and 5 percent of the total value of the estate in to consider the compensation reasonable. Where the fee falls within this range will depend upon the various factors listed above.
Reimbursement For Executor Expenses
Lastly, executors often feel that they need to boost their executor fees because they had to pay a lot of out-of-pocket expenses while they were working on behalf of the estate. They might have had to cover filing costs, make photocopies, pay for postage, or cover other costs. Each of these purchases and tasks can add up to a fairly large balance.
Fortunately, reimbursement for expenses is completely separate from normal compensation. The representatives of the estate can receive reimbursement from the estate to cover approved expenses in addition to the compensation that they receive from their fees.
Working With An Estate Lawyer
If you are unsure how to incorporate executor fees into your will, or if you are an executor and want to ensure that your costs are covered, the Alberta wills lawyers or probate lawyers, respectively, at Kahane Law Office can help you understand how the process works and assist you as you calculate an appropriate fee. A skilled and qualified probate attorney makes your job easier, and less stressful. In addition, they ensure that you receive appropriate compensation for your efforts. They work with you and often for you in terms of managing an estate.
The Calgary probate lawyers and estate lawyers at Kahane Law Office can help you when a family member or loved one has passed away and you are executor for them. You can reach us toll-free at 1-877-225-8817, 403-225-8810 locally or email us directly here today to contact us.