A client’s son recently sat in my Manhattan office, overwhelmed. His mother had just passed, and her will named him as executor of her estate. Amid his grief, he was now facing a mountain of work: locating assets, notifying beneficiaries, paying creditors, and preparing tax returns. His question was simple and direct: “I want to do right by my mom, but this is a full-time job. Does the executor of a will get paid for all this?”
The answer is yes. Serving as an executor is not merely an honorary title; it is a fiduciary role with immense responsibility and legal liability. It is a job. In New York, the law recognizes this by providing for statutory compensation, known as commissions.
The Executor as Fiduciary Steward
An executor is a steward, entrusted with the final chapter of someone’s financial life. This person—often a family member, but sometimes a professional or institution—is legally required to act in the best interests of the estate and its beneficiaries. This is their fiduciary duty.
The work involved is substantial. The executor must:
- Petition the Surrogate’s Court to have the will admitted to probate and be formally appointed.
- Identify, gather, and value all estate assets, from real estate to investment accounts.
- Pay the decedent’s final debts, expenses, and taxes.
- Manage estate property during the administration period, which can last for months or even years.
- Provide a formal accounting to the beneficiaries and the court.
- Distribute the remaining assets according to the terms of the will.
Throughout this process, the executor is accountable to the court and the beneficiaries. A misstep, even an unintentional one, can lead to personal liability. The commission an executor earns is compensation for this significant labor and risk.
How New York Law Calculates Commissions
Many people assume executor fees are arbitrary or based on an hourly rate. New York has a specific, statutory formula for calculating commissions laid out in the Surrogate’s Court Procedure Act (SCPA) § 2307.
The law establishes a sliding scale based on the value of the “commissionable estate”—generally the assets the executor takes into possession and pays out. The percentages are as follows:
- 5% on the first $100,000
- 4% on the next $200,000
- 3% on the next $700,000
- 2.5% on the next $4,000,000
- 2% on any amount above $5,000,000
On a $500,000 estate, for example, the executor’s commission would be calculated as: (5% of $100k) + (4% of $200k) + (3% of $200k) = $5,000 + $8,000 + $6,000 = $19,000. This is the default compensation unless the will specifies otherwise.
This commission is paid from the estate’s assets—before any final distributions are made to beneficiaries—and is treated as an administrative expense.
When the Will Specifies Compensation
A person writing a will, the testator, can override the statutory formula. A will might state that the executor should receive a specific lump sum, a different percentage, or serve without any compensation at all. This is often the case when a spouse or a child who is also a primary beneficiary is named executor.
If the will provides for a fee substantially lower than the statutory commission, the named executor has a choice. Under New York law, they can file a written renunciation of the compensation specified in the will and elect to take the standard statutory commission instead. This must be done within four months of being appointed by the court. The decision requires careful thought, as it can impact family dynamics and the net assets available for distribution.
If there are multiple executors and the gross value of the estate is $300,000 or more, each executor is entitled to a full statutory commission. If the estate is worth less than $300,000, they must share a single commission. This is a crucial detail to consider when appointing co-executors.
A Deliberate and Intentional Choice
Appointing an executor is one of the most important decisions in estate planning. It requires placing enormous trust in an individual’s integrity and diligence. Deciding how—or if—that person will be compensated is an equally important part of that process.
Simply defaulting to the state statute is one option, but a more prudent approach is to be intentional. Discuss the role with your chosen executor ahead of time so they understand the commitment. A thoughtfully drafted will can clarify your wishes, prevent misunderstandings among beneficiaries, and ensure the person stewarding your legacy is treated fairly.
If you are preparing your will, the next step is to deliberately consider who you will appoint and what their compensation arrangement should be. If you have been named as an executor and are unsure of your duties and rights, schedule a consultation with our firm to review the specific provisions of the will you are tasked with administering.
