California Trustee Fee Calculator

California Trustee Fee Calculator

Estimated Trustee Fee: $0.00

function calculateTrusteeFee() { var totalValue = parseFloat(document.getElementById("trustAssetsValue").value); var fee = 0; if (isNaN(totalValue) || totalValue 0) { var amountInTier = Math.min(remainingValue, 100000); fee += amountInTier * 0.04; remainingValue -= amountInTier; } // Tier 2: 3% on the next $100,000 (up to $200,000 total) if (remainingValue > 0) { var amountInTier = Math.min(remainingValue, 100000); fee += amountInTier * 0.03; remainingValue -= amountInTier; } // Tier 3: 2% on the next $800,000 (up to $1,000,000 total) if (remainingValue > 0) { var amountInTier = Math.min(remainingValue, 800000); fee += amountInTier * 0.02; remainingValue -= amountInTier; } // Tier 4: 1% on the next $9,000,000 (up to $10,000,000 total) if (remainingValue > 0) { var amountInTier = Math.min(remainingValue, 9000000); fee += amountInTier * 0.01; remainingValue -= amountInTier; } // Tier 5: 0.5% on the next $15,000,000 (up to $25,000,000 total) if (remainingValue > 0) { var amountInTier = Math.min(remainingValue, 15000000); fee += amountInTier * 0.005; remainingValue -= amountInTier; } // Tier 6: "Reasonable amount" for amounts over $25,000,000. // For calculator purposes, we'll apply a conservative 0.25% for this portion as an estimate. if (remainingValue > 0) { fee += remainingValue * 0.0025; // 0.25% for amounts over $25M } document.getElementById("trusteeFeeResult").innerHTML = "Estimated Trustee Fee: $" + fee.toFixed(2); }

Understanding California Trustee Fees

When a trust is established, a trustee is appointed to manage the trust's assets according to the terms set forth by the trustor (the person who created the trust). This role comes with significant responsibilities, including asset management, distribution to beneficiaries, tax filings, and more. For their services, trustees are entitled to compensation, known as a trustee fee.

California Probate Code and "Reasonable Compensation"

In California, the primary guideline for trustee compensation is found in Probate Code § 15680, which states that a trustee is entitled to "reasonable compensation." While this sounds subjective, many trusts either specify a fee schedule within the trust document itself or, if silent, often refer to the statutory fee schedule used for executors and administrators in probate estates as a benchmark for what constitutes "reasonable."

This calculator uses the California statutory fee schedule as its basis, which is a common method for estimating trustee fees, especially for non-professional trustees or when the trust document does not provide explicit instructions.

The Statutory Fee Schedule Breakdown

The statutory fee schedule is tiered, meaning the percentage applied decreases as the value of the trust assets increases. This schedule is based on the gross value of the trust assets subject to administration. Here's how it typically breaks down:

• 4% on the first $100,000 of the trust estate.
• 3% on the next $100,000 (i.e., from $100,001 to $200,000).
• 2% on the next $800,000 (i.e., from $200,001 to $1,000,000).
• 1% on the next $9,000,000 (i.e., from $1,000,001 to $10,000,000).
• 0.5% on the next $15,000,000 (i.e., from $10,000,001 to $25,000,000).
• For amounts over $25,000,000, the fee is determined as a "reasonable amount" by the court. For the purpose of this calculator, a conservative estimate of 0.25% is applied to this portion, but actual fees for very large trusts can vary significantly and may require court approval.

Factors Influencing "Reasonable" Compensation

While the statutory schedule provides a useful baseline, a court may consider various factors when determining "reasonable compensation" for a trustee, especially if the trust document is silent or if extraordinary services were performed. These factors can include:

• The complexity of the trust administration.
• The time spent by the trustee.
• The trustee's skill and experience.
• The amount of risk and responsibility involved.
• The success or failure of the trustee's administration.
• Any unusual or extraordinary services performed (e.g., managing a complex business, litigation).

How to Use This Calculator

Simply enter the total gross value of the trust assets into the designated field. The calculator will then apply the California statutory fee schedule to provide an estimated trustee fee. This estimate is a helpful starting point for understanding potential costs.

Important Disclaimer

This calculator provides an estimate only based on the California statutory fee schedule, which is often used as a benchmark for "reasonable compensation." Actual trustee fees can vary based on the specific terms of the trust document, the complexity of the trust, the services rendered by the trustee, and potential court approval. It is always recommended to consult with an experienced estate planning attorney or financial advisor for personalized advice regarding trustee compensation and trust administration.

Example Scenarios:

Let's look at a few examples using the statutory fee schedule:

• Trust Value: $500,000
  • First $100,000 @ 4% = $4,000
  • Next $100,000 @ 3% = $3,000
  • Remaining $300,000 @ 2% = $6,000
  • Total Estimated Fee: $13,000
• Trust Value: $2,500,000
  • First $100,000 @ 4% = $4,000
  • Next $100,000 @ 3% = $3,000
  • Next $800,000 @ 2% = $16,000
  • Remaining $1,500,000 @ 1% = $15,000
  • Total Estimated Fee: $38,000
• Trust Value: $30,000,000
  • First $100,000 @ 4% = $4,000
  • Next $100,000 @ 3% = $3,000
  • Next $800,000 @ 2% = $16,000
  • Next $9,000,000 @ 1% = $90,000
  • Next $15,000,000 @ 0.5% = $75,000
  • Remaining $5,000,000 @ 0.25% (estimated reasonable) = $12,500
  • Total Estimated Fee: $200,500