Often clients begin the estate planning process questioning whether a basic Will is sufficient or if it is worth the additional outlay to set up a Revocable Living Trust. One of the key benefits of a properly structured Trust is the avoidance of the costly and time consuming probate process. Probate fees are defined by statute and can come as a surprise to families during an already complex and stressful time.
Per the statutes attorneys are entitled to reasonable for services rendered to an estate. That schedule provides for fees administration based on the inventory value of the estate assets and the income earned by the estate during administration. In the probate of any estate you can expect to pay attorney’s fees of:
$1,500 for estates with a value less than or equal to $40,000; $2,250 for estates with a value between $40,000 and $70,000; $3,000 for estates with a value between $70,000 and $100,000;
Estates over $100,000, $3,000 plus: 3.0% of the next $900,000, plus 2.5% of the next $2 million, plus 2.0% of the next $2 million, plus 1.5% of the next $5 million, plus 1.0% of the amount over $10 million.
If there are any additional services such as litigation, sale of real property or tax advice there are likely to be additional fees.
The personal representative is also entitled to a statutory commission based on the value of the assets in the probate estate. The commission schedule is as follows – and may apply to multiple personal representatives depending on the situation:
3.0% of the first $1 million, plus 2.5% of the next $4 million, plus 2.0% of the next $5 million, plus 1.5% of the amount above $10 million.
The statutory fee may be increased or decreased by the court upon the request of any interested person depending on the complexity of the administration and the skill with which the personal representative handled the administration.
It is quite common to expend $5000 or more in probate administration; the average cost of a well-structured Revocable Living Trust may be well below the cost of probate and can save considerable time and paperwork for your heirs.
Proper planning is essential if you hope to decrease the out of pocket expense of probate. A well-designed estate plan can significantly reduce the time and expense to your heirs. If you have questions about planning your estate call the Kendrick Law Group at 407-641-5847 for a complimentary consultation.