New York state statutory trustee commissions are not done on a flat basis. The trustee gets two kinds of commissions: annual commissions and paying out commissions.
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A trustee gets yearly New York state statutory trustee commissions for their work managing the trust day-to-day. When it comes to annual commissions, a specific amount is given depending on the size of the trust. The payout schedule of NY trustee commissions is as follows:
1. $10.50 per $1,000 of the first $400,000 of the principal of the trust,
2. $4.50 per $1,000 of the next $600,000 of the principal, and
3. $3.00 per $1,000 of the rest of the trust
Here is our calculator to assist with the math:
New York state statutory trustee commissions are not always easy to calculate. Acting on Trustee commissions without an estate attorney can lead to disastrous results. This page provides some basic rules on trustee commissions, but it is not recommended to take legal action based only on a website.
Commissions for Paying Out
For any money paid out of the trust, the trustee gets a paying-out commission in the amount of one percent (1%).
Are the Commissions Payable Annually?
This is the annual payout amount for New York state statutory trustee commissions. The trustee would be entitled to commissions at the beginning or the end of the year. This can either be the calendar or fiscal year, or it can be any 12 month period. The law also dictates that payment of the commission is paid out partially by the income and partially by the principal of the trust.
Besides the annual payout, there is also a New York state statutory trustee commission that is paid to trustees for the money they pay out of the trust. In that case, the trustee would be entitled to 1% of the amount that is being paid out from the trust. This amount is in addition to the annual commission that trustees collect.
Why It Is Important to Have an Attorney
Acting as a trustee is a job that can take a lot of time and effort. Because of that, there are written into New York law commissions that trustees are allowed to take as compensation for the time that they spend handling the trust. Having an understanding of how trust commissions work is an essential part of acting as a trustee, yet they can get complicated. In addition to that, calculating commissions wrong can end up getting a trustee into hot water if it ends up that a mistake was made in their favor. Because of that, whenever you are made a trustee, you should make sure that you have a New York estate attorney on your side to assist you in your duties to make sure that things are done properly.
How Trustee Commissions Work When there is More Than One Trustee
New York state statutory trustee commissions are further complicated when there is more than one trustee on a trust. In that case, the number of trustees does make a difference in how trust commissions are distributed and how much the trust is worth. For trusts under $100,000, each trustee gets the full commission. In cases of trusts that are $100,000-$400,000, if there are one or two trustees, each trustee is entitled to the full commission and in cases where there are more than two trustees, the commission is divided up amongst all of the trustees. When the amount of the trust is more than $400,000 and there are 1-3 trustees, each trustee is entitled to the full commission amount with the commission being split up amongst all the trustees in cases where there is more than three. It also needs to be kept in mind that all trustee commissions are taxable income.
If you have been appointed trustee, New York state statutory trustee commissions are just one of the complex matters that you will have to deal with as part of your duties. You are required to provide reports to the court on a yearly basis, and you could get into legal trouble if it ended up that the trust commission is calculated incorrectly. New York state statutory trustee commissions can be difficult to calculate. Having a New York estate attorney who is skilled in trust matters on your side is the best way to make sure that you fulfill your duties as trustee in the best way possible. We at the Law Offices of Albert Goodwin are here for you. We are located in New York, NY. You can call us at 718-509-9774 or send us an email at [email protected].