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  1. #1
    debmcq Guest

    Question Texas Executor fees

    State - Texas
    I was recently appointed Independent Administrator of my late aunt's estate in Texas, following a 6-month temporary administration (by her "best friend" who didn't know that any of us 33 relatives existed). The temporary administrator hired her "divorce" lawyer there in Texas to handle the proceedings in Probate Court. He tells me that I am entitled to a 5% "income & disbursements" fee, which only includes 5% of income from interest or dividends and NOT income from the sale of the house, car, or personal property, and 5% of expenses paid, not including any disbursements to the heirs. After researching Chapter 7 of the Texas Probate Code, I tend to disagree with him:
    "PART 6. COMPENSATION, EXPENSES, AND COURT COSTS

    241. Compensation of Personal Representatives
    (a) Executors, administrators, and temporary administrators shall be entitled to receive a commission of five per cent (5%) on all sums they may actually receive in cash, and the same per cent on all sums they may actually pay out in cash, in the administration of the estate on a finding by the court that the executor or administrator has taken care of and managed the estate in compliance with the standards of this code; provided, no commission shall be allowed for receiving funds belonging to the testator or intestate which were on hand or were held for the testator or intestate at the time of his death in a financial institution or a brokerage firm, including cash or a cash equivalent held in a checking account, savings account, certificate of deposit, or money market account; nor for collecting the proceeds of any life insurance policy; nor for paying out cash to the heirs or legatees as such; provided, further, however, that in no event shall the executor or administrator be entitled in the aggregate to more than five per cent (5%) of the gross fair market value of the estate subject to administration."

    I have been searching the internet for several days now, trying to find the correct interpretation of this law. From what I understand, I do NOT get 5% of any of the CASH (approx. $25,000.00 from savings, checking, cd's, etc) that was transferred to the estate account immediately following my aunt's death, or from the future payout to the heirs. I do think I am entitled to 5% of the income from the sale of the property. (House was appraised at $180,000.00, sold for $180,000 and after mortgage, realtor commission, property taxes, etc. were paid, $149,000 was deposited into the estate checking account. The car & other personal property netted approximately $8,200.00.
    Please provide the correct interpretation of this section of the Texas probate code, or point me in the direction of someone who can. Your help will be greatly appreciated!!


  2. #2
    Dandy Don is offline Senior Member
    Join Date
    Apr 2002
    Posts
    9,495
    Your interpretation certainly sounds correct, but with a matter of such importance you really should be consulting with at least 2 local probate attorneys to get the scoop on this. Another wrinkle in the situation is how 2 different administrators are going to get paid--will you have to split the 5% fee or not?
  3. #3
    debmcq Guest
    Thank you for such a quick response.

    After several more hours of research, I have found the information I was looking for..."a guardian will receive no commission on the sale of real estate (Guardianship of Rohburg, 745.S.W.2d 435 (Tex. App.--Houston [1st Dist.] 1988, no writ)), but an executor may receive commissions on the cash received from the sale."

    The temporary administrator has already been paid 5% of the disbursements she made and holds no additional claim against the estate. There was no income to the estate account during that period (except for the initial consolidation of bank accounts).

    I did speak with a local attorney here in Wisconsin, but he is only familiar with Wisconsin laws. I hesitate to contact another attorney in Texas, because the one we have there has already cost us about $10,000!!

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