A trustee will get paid based upon what the trust instrument provides. The trust might authorize a CPA or lawyer serving as trustee to be paid his or her normal hourly rate. It is common for mom and dad to want their professionals to serve as trustees of trusts for their children. If the trustee is a corporate trustee, it will be paid per its published fee schedule, which might be 1% of the assets up to $1,000,000; 3/4ths of 1% up to $2,000,000; ½ of 1% up to $5,000,000; and then a negotiable fee above that. If the corporate trustee is investing the assets it will get a higher percentage.
However, most trusts do not set a percentage. They are either silent or indicate that the trustee shall be paid a reasonable fee. In those cases the trustee must carefully document the time spent and the value of the services. The trustee might want to reach an agreement with the beneficiaries as to a certain percentage of assets under management, which usually bears some relationship to what corporate trustees charge.
In any event, no matter what the document says, no matter what agreement is reached, the Probate Judge can always decide to review and change the trustee’s fee, especially if a petition is filed by a disgruntled beneficiary. That’s why a trustee must be represented by competent counsel like us.
Whether you are a CPA, a professional, or a potential client, contact Givner & Kaye to see how we can help you make more money, save taxes and gain peace of mind over all your estate and asset protection needs. www.GivnerKaye.com (310) 207-8008