Trustee and Executor Compensation in New York: Rules, Examples, and Practical Guidance
- Attorney Staff Writer
- Aug 26
- 3 min read
Serving as a fiduciary—whether as a trustee or as an executor of an estate—is demanding work. New York law recognizes the burden by providing fiduciaries with the right to compensation. But how much are trustees and executors actually paid?
Unlike some states that simply say “reasonable compensation,” New York uses a statutory commission system for both trustees and executors, though the details differ. This article provides a comprehensive overview of trustee and executor compensation in New York, including statutory formulas, income rules, co-fiduciary arrangements, and examples. We’ll also explore when the trust or will may override the default rules, how courts resolve disputes, and how New York compares to other states.
Executor Commissions: SCPA § 2307
Executor compensation is governed by Surrogate’s Court Procedure Act (SCPA) § 2307. The statute provides commissions based on the value of all assets received and paid out by the executor.
The sliding scale is as follows:
5% of the first $100,000
4% of the next $200,000
3% of the next $700,000
2.5% of the next $4,000,000
2% of anything over $5,000,000
Example 1: Estate Valued at $1,000,000
5% × $100,000 = $5,000
4% × $200,000 = $8,000
3% × $700,000 = $21,000
Total executor commission = $34,000
Key Points
Commissions are taken from estate assets before distribution to beneficiaries.
Executors may also seek additional compensation for extraordinary services (e.g., litigation, operating a business, selling real estate).
If multiple executors serve, commissions are divided but subject to statutory minimums and caps.
Trustee Commissions: SCPA § 2309
Trustee compensation is governed by SCPA § 2309. Trustees are paid on both the principal value of the trust and the income collected.
Principal Commissions
1.05% of the first $400,000 of principal
.45% of the next $600,000
.30% of anything above $1,000,000
These commissions are based on the fair market value of trust assets each year.
Income Commissions
Trustees also earn 6% of all income collected (interest, dividends, rents, etc., but not capital gains unless classified as income).
Example 2: Trust Valued at $2,000,000 with $50,000 Income
Principal: $4,200 + $2,700 + $3,000 = $9,900
Income: 6% × $50,000 = $3,000
Total trustee compensation = $12,900 annually
Co-Fiduciaries: Executors and Trustees Together
When there are multiple executors or multiple trustees, New York law requires commissions to be shared:
Executors must divide commissions unless the estate is large enough that each executor would otherwise receive less than $100,000. In that case, the statute allows each to take full commissions up to a point.
Trustees must split principal commissions but each trustee earns their own income commission on income they collect.
This means co-trustees often need to coordinate carefully to balance work and compensation.
When the Instrument Overrides the Statute
Both wills and trusts can modify fiduciary compensation rules:
A will may waive executor commissions (common if a family member is executor).
A trust may adopt a corporate trustee’s fee schedule instead of the statutory formula.
Fiduciaries may agree to reduced or no compensation—but should document the agreement clearly.
Unless overridden, the statutory scheme applies automatically.
Court Oversight and Challenges
Even when fiduciaries follow the statutory formula, beneficiaries may challenge commissions in Surrogate’s Court. Courts may review:
Whether the fiduciary properly valued assets.
Whether income and principal were calculated correctly.
Whether extraordinary compensation is warranted.
Whether a waiver of compensation is enforceable.
Executors and trustees must keep accurate records to justify their fees.
Comparison to Other States
New York’s statutory fee system is unusual. Many states—including California and Florida—use a “reasonable compensation” standard, which gives courts discretion but often leads to uncertainty.
Pros of New York’s system:
Predictability for fiduciaries and beneficiaries.
Easy to verify against statutory percentages.
Cons:
May undercompensate fiduciaries handling complex estates or trusts.
May overcompensate fiduciaries when the work is straightforward.
Drafting Considerations for Attorneys
When drafting wills and trusts in New York, attorneys should consider:
Whether family members are expected to serve without pay—if so, waive commissions expressly.
Whether a corporate fiduciary will serve—if so, reference their published fee schedule.
Whether extraordinary compensation is anticipated—for example, if a trust holds a family business or real estate portfolio.
Key Takeaways
Executor commissions are set by SCPA § 2307 and follow a tiered percentage of estate assets received and paid out.
Trustee commissions are set by SCPA § 2309 and include both principal and income components.
Co-fiduciaries must share commissions, though trustees split differently than executors.
Trusts and wills can override statutory rules with custom provisions.
Courts may review and adjust compensation in the event of disputes.
Compared to other states, New York’s system is predictable but rigid.
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