Serving as a trustee for a trust administration can be a challenging and demanding task. Often, individuals will appoint family members to serve as trustees. Other times, individuals may appoint licensed fiduciaries. In both scenarios, the California Probate Code allows a trustee to request and take compensation for his or her services so long as the compensation is “reasonable.”
There are many factors used to determine if the compensation a trustee is requesting is reasonable. These factors include the trustee’s skill and experience – for instance, is a family member serving as trustee for the first time or a licensed fiduciary? Other factors include the amount of time the trustee expended to administer the trust and the level of complexity of the trust administration. This is often a big factor because while some trust administrations are straight forward, others can be incredibly time-consuming involving many forms of assets and multiple beneficiaries. Another important factor is the quality of the trustee’s work and performance. Did the trustee administer the trust based on the requirements of the trust document and the Uniform Prudent Investor Act of the California Probate Code?
There is no set recipe or algorithm to calculate a trustee’s “reasonable” compensation. Many factors must be considered, and the trustee’s performance analyzed in order to determine how much compensation a trustee can reasonably request. To learn more about this, please contact the attorneys at Chauvel & Glatt, LLP.
The material in this article, provided by Chauvel & Glatt, is designed to provide informative and current information as of the date of the post. It should not be considered, nor is it intended to constitute, legal advice or promise similar outcomes. For information on your particular circumstances, please contact Chauvel & Glatt at 650-573-9500.