Executor Compensation and Fees (TN)
If the will does not specify how executor compensation should be calculated, TN estates must follow state compensation rules (see TN calculator below).
In Tennessee, the estate executor is known as a "personal representative".
Tennessee law specifies only "reasonable" compensation, and courts have interpreted this to include consideration of a number of factors, including:
- Nature of the work involved (time, effort, difficulty, skills required)
- Compensation customarily charged (in the community for similar services)
- Size of the estate (and the results obtained)
- The relationship of the personal representative to the decedent
- The amount of work outsourced by the personal representative
- Experience and capabilities of the person
Some counties go further, and provide specific guidance based on the value of the estate. For example, Hamilton County takes the position in Civic Practice Rule 17.12 that if you regularly serve as an executor, by default the following rates would be considered reasonable:
- 5% on the first $20K
- 4% on the next $80K
- 3% on the next $150K
- 2% on the next $500K
- 1% on anything more
So, for example, a Hamilton County estate worth $50K would yield $2,200 in executor fees, and one worth $600K would generate $15,750 in executor fees.
However, if you aren't an experienced executor, then the Hamilton County guidelines say the amounts above should be reduced by 75%. For what it's worth, neither the original scale above, nor the 75% reduction, are legal statutes.
Other counties simply say to check prevailing rates, and usually these are much more generous (see estimation methodology). For example in Davidson County, a representative schedule is:
- 4% on the first $300K
- 3% on the next $900K
- 2% on the next $300K
- 1% on anything more
If the chosen compensation approach is based on the estate value, as above, then assets that pass directly to named beneficiaries, such as life insurance policies or 401Ks, are generally not included in these calculations.
Additionally, under an estate value approach, additional compensation for extraordinary services is allowed. Common interpretations of "extraordinary" include overseeing the sale or lease of real estate, running a business, conducting litigation, preparing tax returns yourself, handling tax audits, and so on.
The bottom line is that in Tennessee, there is considerable variability in approach. You can use the calculators below to get a feel for what might be reasonable, and if your county is not specifically listed, it might make sense to check with the Probate Court in the county of the estate to see if there are any particular guidelines. Keep in mind, though, that the statute says "reasonable", and the guidelines are only intended to be helpful.
Finally, note that when there is not enough money in the estate to pay all obligations, paying executor compensation and other costs of estate administration have priority over all other claims.
TN Compensation Calculator
EstateExec provides the following executor compensation estimator for TN estates, but please keep in mind that there are no hard and fast rules for TN 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. See estimation methodology for details.
You can use this calculator now, but if you use EstateExec to help you track the settlement process, it will automatically calculate the inputs for you based on the estate and suggest those values in the fields below (you can create an estate for free).
See also Compensation for general remarks on executor compensation.