Legal Question in Wills and Trusts in Maryland
executor's fees
my sister is executrix and sole trustee of father's estate. she, my brother and I are equal beneficiaries. the estate lawyer told her she is entitled to a fee. she lives across the country and has made several trips by plane to fulfill her duties. does the payment for trips and lawyer's advice on her duties and fee entitlement come from estate or from her fee as executrix. The lawyer also told her my brother and I could give her a gift(money) from our partial disbursement checks so she could avoid paying taxes on fee. estate is worth slightly less than 600k, Should we gift her the money? how much? Father died in Dec. condo fees are mounting up do to non action on selling condo as of march. Also, lawyer told her she is entitled to retroactive fee as of June when she took over as power of atty due to Father's illness. My brother and I did not know she was to be compensated, and are feeling a little funny about it.
1 Answer from Attorneys
Re: executor's fees
The attorney's fees will be paid from the estate as allowed by statute. Attorney's fees for the probate of estates are set by statute and must be approved by the court before the attorney takes the fee. This assumes that the attorney is under contract as a probate attorney.
Gifts can be taxable events. Gifts cannot be made through an estate without probate exept for POD accounts and these are not true gifts in a legal sense. Given the size of the estate taxes should not be an issue.
Fees paid for personal representation of an estate are taxable. Such fees can be designated in a last will and testament or otherwise payable.
Retroactive fees for payment of services under a power of attorney do not ordinarily occur unless the POA sets forth compensation, which is also taxable unless such falls under the gifting taxation level.
You may consider contacting an attorney for a review of the estate.
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