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Trustee management fee

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Good Brother

Junior Member
What is the name of your state (only U.S. law)? California
My question is, what is an appropriate amount to charge my siblings for all the time I spent dealing with the business of our Mother's trust?

For the last 6 1/2 years I have managed our Mother's trust. It is a small trust consisting of only her past home (now a rental) and a checking account.

The first three years, while my mother was still living, required quite a lot of time, after her death, less time. All told I figure with paying bills, writing checks, making deposits, tax prep., tax consult, etc. I have conservatively 360 hours spent administering/managing the trust.

I also have many, many hours and transportation costs property managing the rental house, with a revolving door of 4 renters in 6 1/2 years. Now, we have listed the property and are in escrow to finalize the sale of the property. With many, many hours once again dealing with everything necessary to accomplish the closing.

All that said, what is a fair/reasonable fee to charge my sisters?
 


curb1

Senior Member
What have they suggested as payment? You should be entitled to reasonable compensation for your efforts. Were they willing to help? Did they do work that would offset what you did? If you suggested $4,000. what would be their reaction? You need to discuss this with them. Keep it civil or you will create problems that you wouldn't want to have.
 

LdiJ

Senior Member
What is the name of your state (only U.S. law)? California
My question is, what is an appropriate amount to charge my siblings for all the time I spent dealing with the business of our Mother's trust?

For the last 6 1/2 years I have managed our Mother's trust. It is a small trust consisting of only her past home (now a rental) and a checking account.

The first three years, while my mother was still living, required quite a lot of time, after her death, less time. All told I figure with paying bills, writing checks, making deposits, tax prep., tax consult, etc. I have conservatively 360 hours spent administering/managing the trust.

I also have many, many hours and transportation costs property managing the rental house, with a revolving door of 4 renters in 6 1/2 years. Now, we have listed the property and are in escrow to finalize the sale of the property. With many, many hours once again dealing with everything necessary to accomplish the closing.

All that said, what is a fair/reasonable fee to charge my sisters?
The following may be helpful:

Article 5. Compensation And Indemnification Of Trustees :: California Probate Code :: 2009 California Code :: California Code :: US Codes and Statutes :: US Law :: Justia
 

Good Brother

Junior Member
Thanks, just what I was looking for. I would like opinions on the fee schedules outlined below, thanks.

Monthly Administration and Management Fees
Monthly admin./mngmnt. 3 yrs. x 6 hrs. / mo. = 216 hrs.
Monthly admin./mngmnt. 3 ½ yrs. x 2 hrs. / mo. = 84 hrs.
Tax Prep. 6 ½ yrs. x 8 hrs. /yr. = 52 hrs.
Tax consult 7 yrs. x 1 hr./yr. = 7 hrs.
Total hours 360 hrs.
Monthly admin./mngmnt. Fees 360 hours X $25/hr. = $9000.00

Property Management Fees (10%) 6 ½ yrs. X $3600/yr. = $23,400.00

Admin./Mngmt. Fees & Property Mngmt. Total Cost $32,400.00

Discounted Fee Schedule
Monthly admin./mngmnt. Fees 360 hours X $20/hr. = $7200.00

Property Management Fees (5%) 6 ½ yrs. X $1800/yr. = $11,700.00

Admin./Mngmt. Fees & Property Mngmt. Total Cost $18,900.00

I think if I present both fee schedules and ask for the discounted schedule
 
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LdiJ

Senior Member
Thanks, just what I was looking for. I would like opinions on the fee schedules outlined below, thanks.

Monthly Administration and Management Fees
Monthly admin./mngmnt. 3 yrs. x 6 hrs. / mo. = 216 hrs.
Monthly admin./mngmnt. 3 ½ yrs. x 2 hrs. / mo. = 84 hrs.
Tax Prep. 6 ½ yrs. x 8 hrs. /yr. = 52 hrs.
Tax consult 7 yrs. x 1 hr./yr. = 7 hrs.
Total hours 360 hrs.
Monthly admin./mngmnt. Fees 360 hours X $25/hr. = $9000.00

Property Management Fees (10%) 6 ½ yrs. X $3600/yr. = $23,400.00

Admin./Mngmt. Fees & Property Mngmt. Total Cost $32,400.00

Discounted Fee Schedule
Monthly admin./mngmnt. Fees 360 hours X $20/hr. = $7200.00

Property Management Fees (5%) 6 ½ yrs. X $1800/yr. = $11,700.00

Admin./Mngmt. Fees & Property Mngmt. Total Cost $18,900.00

I think if I present both fee schedules and ask for the discounted schedule
How large is the trust? That actually sounds a bit steep to me. Do remember that the trust has to pay the fees to the trustee BEFORE the money is divided/distributed. Therefore if there are three of your 1/3 of the fees will be coming out of YOUR share.
 

curb1

Senior Member
That is outrageous as far as I'm concerned. Those kind of fees needed to be discussed 6 1/2 years ago rather than bomb the family now.

It sounds like there is a communication problem in the family that will get ugly when these numbers are presented.
 

tranquility

Senior Member
Administering the trust involved administering the property. Collecting rents and the like is not sufficiently skilled enough to qualify as something the executor could charge extra for. (Unless the OP is actively doing evictions and the like too. Not just approving them, doing them.)
 

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