NYS executor fee is calculated as follows:
- 5% of the first $100,000
- 4% of the next $200,000
- 3% the next $700,000
- 2.5% of the next $4 Million
- 2% of the rest of the value of the estate
This calculation instruction is written out in SCPA 2307.
Here is our interactive New York State executor fee calculator, for help with the math involved:
We hope that this New York state executor fee calculator will be been helpful to you.
Executors of New York Estates are not expected to carry out their responsibilities free of charge. They are usually entitled to compensation. This compensation is called “commissions.” The amount is set by law, in SCPA 2307.
To calculate the executor fee in NY, seek the advice of an estate attorney. The calculation can be trickier than people think.
Keep in mind that the statute requires that commissions are split between receiving and paying out. The amount of the NYS executor fee will be the same as above, but listing it will look different. That’s because the “receiving” fee and “paying out” fee will be specified, each being half of the total executor fee calculated.
What Percentage of the Estate Does the Executor Take as Their Fee
Using the percentages can be a bit confusing. Even though the NYS executor fee calculator above does the math for you, you should still be able to double-check and do the math yourself. Here is an additional explanation, which will help you understand how the calculation works:
• 5% of the first $100,000
• 4% of the next $200,000 (so $5,000 plus 4% of estate value up to $300,000)
• 3% the next $700,000 (so $5,000 plus $8,000 plus 3% of estate value up to $1 million)
• 2.5% of the next $4 Million (so $5,000 plus $8,000 plus $21,000 plus 2.5% of estate value up to $5 million)
• 2% of the rest (this is an estate that is worth more than $5 Million, so $5,000 plus $8,000 plus $21,000 plus $100,000 plus 2% of estate value over $5 Million)
We calculate the percentage based on the value of the estate’s assets plus income derived from those assets. For example, interest received from property of the estate is included in when you calculate the executor commission, but the property itself may not be included because the executor is not involved in the property’s sale. This is sometimes counterintuitive because the executor usually is involved in retitling the property from the decedent to the beneficiaries. As you can see, it is not always easy to determine which assets are included in the calculation, so an executor is well advised to consult with an estate attorney before taking their fees. It is likely that a preliminary account of the estate will be required when filing for a request for advance commissions.
The executor may be entitled to additional reasonable compensation in connection with property management (5% of gross rentals), litigation or tax matters or management of the decedent’s business matters.
What Assets Are Not Included When You Calculate the NYS Executor Fee
Assets passing outside of the estate or left to specifically named beneficiaries in a will are not included in the NYS executor fee calculation.
Assets that pass outside of the estate are not includable in calculating the NYS executor fee, also called “non-probate assets,” are not a part of the estate, and the executor, therefore, is not involved in their distribution and cannot charge commissions for them. They include:
- accounts with named beneficiaries
- accounts held jointly with the person who died
- real estate owned jointly with the person who died
- life insurance policies payable to individual beneficiaries
- real estate given to specific beneficiaries is also not a part of the estate
Specific legacy or devise is not includable in commission calculation – the value of real property or personal property left to a specific person cannot be used as a basis of calculating executor commissions. If there is a reason that this property has to be handled by the executor, for example, sold and the proceeds distributed, then the property may be includable in commission calculation.
As a rule of thumb, property that the executor is not receiving and paying out is not included in calculating their commission.
How Do I Allocate the NYS Executor Fee if There is More Than One Executor
- Estates Under $100,000 – For estates under $100,000, there is a “one commission rule” – one commission is split between all of the executors.
- Estates from $100,000 to $300,000 – For estates valued between $100,000 and $300,000, there is a “up to two commissions rule” – two commissions are split between all the executors.
- Estates at $300,000 and over – For estates valued at over $300,000, there is an “up to three commissions rule” – up to three fiduciaries can get separate fees, but if there are more than three fiduciaries, they divide three commissions.
Is NYS Executor Fee Subject to Income Tax
Yes, typical NYS executor fees (commissions) are counted as income and are subject to income tax. On the other hand, the IRS and New York Department of Revenue give estate executors an option to forego commissions and not pay income tax. Foregoing commissions may make sense for an executor who is the only beneficiary of an estate, or even for someone who is not the only beneficiary, in light of the income-tax savings. You can discuss this with an estate attorney and a tax advisor.
Can an Executor Get an Advance Payment of Commissions
There is no automatic right to advance payment of commissions – they are usually paid at the conclusion of the estate, with our strong insistence that executors receive a waiver from the beneficiaries. However, New York SCPA 2310 and 2311 do authorize the executor to apply to the court for the advance payment of commissions and will be able to take advance commissions if the judge issues an order allowing them to do so.
What is “Receiving and Paying Out”?
SCPA 2307 states that when NYS executor fee is calculated, the amount of the fee should be split in half and the first half is presented as fee for “receiving” the estate and the second half is presented as “paying out” the estate. Although this does not impact the amount of the fee that the executor receives, it does impact how the numbers are presented in the accounting document submitted to the court or to the interested parties. An estate attorney familiar with submitting estate accounting documents would know how those numbers should be presented correctly.
What is the NYS Executor Fee Specified in the Will is Different from the Default Compensation Set Forth by New York Law?
Some Wills direct that the executor is to serve without compensation, but those wills are far and few in between. Even fewer Wills specify the amount or the percentages of the executor commissions. Typical executor fees are in accordance with SCPA 2307, but a will can change that default. So it’s always a good idea to double-check your will because if the will does set the amount of compensation, the direction of the will overwrites the default executor commission rate set forth in SCPA 2307.
Do I Need Written Consent of the Beneficiaries Before I Take My Fee
Although it is theoretically possible to take the executor fee at the end of the case without written confirmation from the beneficiaries, it is almost unthinkable to do so in real-world practice because of the concern that the beneficiaries may challenge the amount at a later date. Obtaining a written waiver and consent from beneficiaries of a New York estate is a must before collecting the executor fee. It is standard practice to obtain beneficiaries’ consent not only on executor commissions but also on all aspects of an estate before the estate is settled.
Serving as an executor of a New York estate may require a great deal of time and expertise depending on the size of the estate and the type of assets. Under NY SCPA 2307, an executor of a New York estate is entitled to receive compensation for their time and efforts in connection with the management of the estate assets and the distribution of the assets to the beneficiaries.
If you need to calculate New York executor fees as per SCPA 2307, and other help in an estate, you can get in touch with New York estate attorney Albert Goodwin at firstname.lastname@example.org or by calling (212) 233-1233.
(Updated on 12/23/2018)
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