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Whether you’re considering someone’s request that you be the executor (also known as “personal representative”) of their estate when the time comes or you’re preparing to begin that role after a death, it’s important to understand what Texas law says about compensation.

Many executors don’t even realize that they have a legal right to compensation. However, administering an estate is a job – sometimes a long and difficult one. Even those who don’t leave behind a vast estate may leave a lot of problems that have to be addressed before it can be settled. 

Why should you consider not taking compensation?

Executor compensation is paid from the estate (and not any one person’s inheritance) before any assets are distributed to beneficiaries. If you’re a beneficiary of the estate, it may be worthwhile to determine whether it’s better for you financially not to take the compensation and have a slightly larger inheritance or if you’ll get more if you take the compensation. This can require some calculations. 

Note that inheritances aren’t taxable as income, while executor compensation is. Don’t let family members or others dissuade you from taking compensation you have a right to be paid for your work. After all, you may have to take time off work, travel and more to settle the estate.

How much do Texas estate executors get paid? 

Under Texas law, executor compensation “may not exceed, in the aggregate, more than five percent of the gross fair market value of the estate subject to administration.” That’s true whether the decedent addressed it in their estate plan or not. If there was no will and you were appointed by the probate court to administer the estate, the law still applies. 

If you encounter unexpected or significant challenges as you administer the estate, you have the right to ask the probate court for additional compensation. However, be prepared to present a solid case for why that’s warranted. Also, be sure to keep records of any expenses you had to pay out-of-pocket so you can seek reimbursement.

As an executor of an estate, you may need to seek professional guidance for help in real estate, tax, financial and other matters. Of course, it’s always wise to have legal guidance to help avoid costly and time-consuming errors.