How does an executor get their executors fee?
An executor is a person that is appointed by an estate in order to carry out the conditions of the will of a deceased person. The way their fee is processed differs by state. Each state has different rates that go with different values of the estate. For example, in California, the rate for the first $100,000 value of assets is 4%. The next $100,000 is an additional 3%. The next $800,000 value of the estate goes for a 2% rate. So in the end, a $1,000,000 value on an estate would give the executor a rate of 9%, or $90,000 executor fee. How they get this $90,000 is by charging the estate, itself. So if the value was at $1 million, the new value would be at $910,000 due to the fee. Before this can be done though, the rate must be approved by the court and legal documentation must be provided to prove the efforts of the executor is just. If there is no cash balance in the estate, then the executor can become a creditor to the estate.