Executor compensation is the fee paid to a personal representative for administering an estate. Amounts are set by state statute, court practice, or the will, and may be based on percentages, hourly rates, or "reasonable compensation." Factors include estate complexity, time spent, and results achieved. Compensation is taxable income to the executor and reduces the estate for tax purposes. Clear fee terms in the will and thorough time records help avoid disputes and ensure compensation reflects the work required to collect assets, pay debts, file returns, and distribute property.

Advisors set expectations early by explaining statutory or negotiated fees and how they are calculated. Executors keep time logs and obtain court or beneficiary approval where required. Clear documentation prevents conflict and ensures fees reflect the work involved-asset collection, tax filings, sales of property, and final distributions.