Whether your loved one dies testate (with a will) or intestate (without a will), his or her estate will be subject to the California probate process—the roughly twelve-to-sixteen-month process whereby a court oversees distribution of an estate to its beneficiaries. The personal representative of an estate (the “executor”) is entitled to compensation for services he or she performs on the estate’s behalf in an amount set by California Probate Code § 10800. As per the terms of this Section, a personal representative shall receive compensation based upon the overall gross value of the estate as follows:

  • 4% of the first $100,000.00;
  • 3% of the second $100,000.00;
  • 2% of the next $800,000.00;
  • 1% of the next $9,000,000.00;
  • 0.5% of the next $15,000,000.00; and
  • A reasonable amount, as determined by the court, for estates valued at over $25,000,000.00.

In practice, this means that if a probate estate has a gross value of five hundred thousand dollars, its personal representative is entitled to compensation in the amount of $13,000.00. This mandatory compensation amount is calculated as follows:

Estate Value (Gross) Compensation Percentage Compensation Amount
$100,000.00 4% (.04) $4,000.00
$100,000.00 3% (.03) $3,000.00
$100,000.00 2% (.02) $2,000.00
$100,000.00 2% (.02) $2,000.00
$100,000.00 2% (.02) $2,000.00
Totals: $500,000.00 $13,000.00

However, if your loved one created a trust prior to his or her passing, their estate would not be subject to the probate process (thereby avoiding delays created by probate proceedings). Furthermore, the successor trustee of a trust—the individual nominated within the trust instrument charged with administration of the decedent’s estate—is not entitled to the above-referenced statutory fees. Instead, a successor trustee is entitled to compensation as set forth in the trust instrument (California Probate Code §15680) or a “reasonable” fee (California Probate Code § 15618).
While there are a variety of factors to consider when determining a “reasonable” fee such as the value of the estate, the degree of responsibility assumed by the successor trustee, the time spent performing his or her duties, and whether the work was ordinary or extraordinary in nature (California Rules of Court 7.776), generally a successor trustee’s compensation is roughly one to two percent of the gross value of the estate. Thus, utilizing the same five hundred-thousand-dollar estate as an example, a successor trustee’s compensation can be calculated as follows:

Estate Value (Gross) Compensation Percentage Compensation Amount
$500,000.00 1% (.01) $5,000.00
$500,000.00 2% (.02) $10,000.00

As evidenced by these examples, an individual can potentially save his or her beneficiaries thousands of dollars in administrative costs—as well as months in court—should he or she simply create and fund a trust.