When you draft a last will and testament, part of the process is to designate someone who will serve as the executor of your estate. This decision should be carefully considered as an executor is a very important role in the probate process and will oversee the winding up of your affairs and the distribution of your property. There are many tasks assigned to an executor, including the following:
- Locate and notify all beneficiaries
- Manage your financial accounts
- File and pay taxes
- Pay creditors or challenge creditor claims
- Defend against any challenges to the will by beneficiaries or potential heirs
- Distribute property in accordance with instructions in the will
Some estates can involve complex financial accounts and many types of investments, assets, and property. It can take time for an estate to be resolved and an executor can contribute significant time and energy to their duties.
Because of the complexity of the duties of certain executors, a common question is whether an executor can be paid for their services. In New Jersey, the answer is “yes,” with some restrictions and exceptions. The law allows executors to take commissions on the assets they control and manage during the probate process. Generally speaking, the commission goes as follows under the law:
- 5 percent of the first $200,000 of the estate
- 5 percent of any amount over $200,000 and up to $1,000,000
- 2 percent of any amount over $1,000,000
- 6 percent of any income – such as dividends – received under the executor’s control
In addition, the person who drafted the will and the executor can agree on a lesser amount or a greater amount of payment. The probate court can also decrease or increase commissions if it is requested and found to be justified.
While it seems only fair that an executor receives payment for their duties, many conflicts can arise regarding the commission of an executor. For example, a beneficiary may believe that an executor paid themselves too much from the estate. An executor may also believe they are owed more if the execution of the estate was particularly complicated. If you think there is a problem involving the commission of an executor, you should discuss your situation with an experienced estate planning attorney as soon as possible.
Call 732 238-8686 today for more information.
It is important for any beneficiary or executor to consult with a New Jersey estate planning lawyer regarding any issues you are facing. Probate can involve complex legal issues and the law office of Bowne Barry & Barry is here to help. Call us today to learn more.