Executor Compensation and Fees (AK)
If the will does not specify how executor compensation should be calculated, AK estates must follow state compensation rules (see AK calculator below).
In Alaska, the estate executor is known as a "personal representative".
In determining executor fees, the state of Alaska uses the commonly accepted principle of "reasonable" compensation, and in 1995 the State Supreme Court issued Probate Rule 7.1, which states that the following factors may be considered in determining what is reasonable:
- Time and labor required
- Complexity of the estate
- Individual liability exposure
- Amounts charged by any agents hired
Note that the last point above does not mean you need to reduce your executor fee because, for example, you had to pay a lawyer to prepare legal documents: that's to be expected. However, if you pay someone to do a substantial amount of the work normally expected of the executor, and charge the estate for that, then you should reduce your fee appropriately.
Overall, it's common in AK to use a "services-rendered" approach, and bill by the hour (the hourly rate can be determined according to the factors above). Executors also set fees as a percentage of the overall estate value, or even as a flat fee. Whatever approach you decide, it is important that you keep detailed records of your efforts in case you need to justify your fee in court:
- Nature of the task (e.g., Drove to bank to get medallion stamp for IBM stock)
- Amount of time spent (e.g., 2 hours)
- Hourly rate for the task (e.g., $35/hour)
- Results (e.g., sold the car for Blue Book value)
While compensation varies greatly according to a variety of factors, the calculator below indicates that a typical fee for a $125K estate that required 200 hours of standard work might be around $6K, and for a $1M estate that required 400 hours of standard work and 80 hours of professional labor on your part, $33K might be appropriate.
Even if a will specifies the compensation for the executor (and there is no contract with the decedent regarding compensation), the executor may renounce the relevant provision before being assigned executor, and be entitled to reasonable compensation.
AK Compensation Calculator
EstateExec provides the following executor compensation estimator for AK estates, but please keep in mind that there are no hard and fast rules for AK estates, and ultimately you must determine what would be reasonable for your particular circumstances. By using this estimator, you acknowledge that EstateExec provides any results as informational input only, not as legal advice, and cannot be held responsible for any inaccuracies for, or misunderstandings about, any given estate.
Below EstateExec provides two compensation approaches: you can decide which, if either, is appropriate for you. The first uses a sliding percentage scale based on the total estate gross value (the larger the estate, the smaller the percentage); the second simply compensates the executor for the value of his or her time, and is the more common approach in AK. See estimation methodology for details.
See also Compensation for general remarks on executor compensation.