How much does the attorney for the personal representative get paid in Florida?
Under Florida law, attorneys for personal representatives shall be entitled to reasonable compensation payable from estate assets without court order. See, Fla. Stat. § 733.6171(1). Florida law requires that an estate have both a personal representative and an attorney during the administration of an estate. The attorney requirement may be dispensed with if the personal representative is the sole interested person. See, Fla. Prob. R. 5.030(a).
Compensation for Florida attorneys for personal representatives is presumed to be reasonable if based on the compensable value of the decedent’s estate—calculated as the inventory value of the probate estate and income earned by the estate during its administration and calculated under the following schedule:
- $1,500 for estates having a value of $40,000 or less;
- An additional $750 for estates having a value of $40,000 and not exceeding $70,000;
- An additional $750 for estates having a value of $750 for estates having a value of $70,000 and not exceeding 100,000;
- For estates having a value in excess of $100,000, 3% for next $900,000;
- 5% for all above $1 million and not exceeding $3 million;
- 2% for all above $3 million and not exceeding $5 million;
- 5% for all above $5 million and not exceeding $10 million;
- 0% for all above $10 million.
See, Fla. Stat. § 733.6171(3).
Can an attorney forego the statutory compensation in favor of the attorney’s hourly rate?
Attorneys, personal representatives, and those who bear the impact of the compensation (essentially, the beneficiaries of the estate) may agree to a compensation schedule of their choosing, for example, an hourly rate. See, Fla. Stat. § 733.6171(2).
Reasonable fees for extraordinary services
In addition, under Fla. Stat. § 733.6171(4), the attorney for the personal representative shall be permitted further reasonable compensation for any extraordinary service. Extraordinary service depends on many factors, including the compensable value of the estate. Extraordinary services may include, but are not limited to:
- Involvement in a will contest, will construction, a proceeding for determination of beneficiaries, a contested claim, elective share proceeding, apportionment of estate taxes, or any adversarial proceeding or litigation by or against the estate.
- Representation of the personal representative in audit or any proceeding for adjustment, determination, or collection of any taxes.
- Tax advice on postmortem tax planning, including but not limited to, disclaimer, renunciation of fiduciary commission, alternate valuation date, allocation of administrative expenses between tax returns, the QTIP or reverse QTIP election, allocation of GST exemption, qualification for internal Revenue Code §§ 6166 and 303 privileges, deduction of last illness expenses, fiscal year planning, distribution planning, asset basis considerations, handling income or deductions in respect of a decedent, valuation discounts, special use and other valuation, handling employee benefit or retirement proceeds, prompt assessment request, or request for release of personal liability for payment of tax.
- Review of estate tax return and preparation or review of other tax returns required to be filed by the personal representative.
- Preparation of the estate’s federal estate tax return.
- Purchase, sale, lease, or encumbrance of real property by the personal representative of involvement in zoning, land use, environmental, or other similar matters.
- Legal advice regarding carrying on of the decedent’s business or conducting other commercial activity by the personal representative.
- Legal advice regarding claims for damage to the environment or related procedures
- Legal advice regarding homestead status of real property or proceedings involving that status and services related to protected homestead.
- Involvement in fiduciary, employee or attorney compensation disputes.
- Proceedings involving ancillary administration of assets not subject to administration in this state.
What if the attorney had a separate agreement with the decedent regarding compensation?
During his or her life, a testator (a person who has made a will) can sign a written agreement with an attorney regarding compensation for the attorney’s service in administering the estate. The agreement must be in writing. If such an agreement exists, the attorney must furnish a copy of the written agreement to the personal representative prior to commencement of employment. All interested persons are to be served with a copy of the agreement if the attorney is ultimately employed by the personal representative. See, Fla. Stat. § 733.6171(6).
A personal representative is not obligated to retain the lawyer specified in the will or in a separate agreement. If, however, the attorney who is a party to the agreement or who drafted the will is employed, the attorney’s compensation shall not exceed the compensation provided in the agreement or in the will. Fla. Stat. § 733.6171(6).
Can the court increase or decrease the compensation for an attorney’s ordinary services?
Fla. Stat. § 733.6171(5), states:
Upon petition of any interested person, the court may increase or decrease the compensation for ordinary services of the personal representative or award compensation for extraordinary services if the facts and circumstances of the particular administration warrant. In determining, reasonable compensation, the court shall consider all of the following factors, giving weight to each as it determines to be appropriate:
(a) The promptness, efficiency, and skill with which the administration was handled by the personal representative;
(b) The responsibilities assumed by and the potential liabilities of the personal representative;
(c) The nature and value of the assets that are affected by the decedent’s death;
(d) The benefits or detriments resulting to the estate or interested persons from the personal representative’s services;
(e) The complexity or simplicity of the administration and novelty of the issues presented;
(f) The personal representative’s participation in tax planning for the estate and the estate’s beneficiaries and in tax return preparation, review, or approval;
(g) The nature of the probate, nonprobate, and exempt assets, the expenses of administration, the liabilities of the decedent, and the compensation paid to other professionals and fiduciaries;
(h) Any delay in payment of the compensation after the services were furnished; and
(i) Any other relevant factors.
It is important for all individuals involved in a probate proceeding, whether as a personal representative, beneficiary, interested person, or otherwise to understand how the attorney for the personal representative is being compensated.
If you have questions understanding the proposed compensation of an attorney in a probate proceeding, please call the attorneys at Comiter, Singer, Baseman & Braun LLP to discuss your case. We may be reached at (561) 626-2101 or toll free at (800) 226-1484 for a free consultation about your probate matter.