Many people agree to serve as the executor of a loved one's estate believing it is simply an honor or family obligation. Others assume they are entitled to charge whatever amount they believe their time is worth.

Neither assumption is entirely correct.

Texas law contains detailed rules governing executor compensation, including situations where an executor receives a statutory commission, where compensation may be denied entirely, and where a court may approve different compensation.

Understanding these rules can prevent disputes among beneficiaries and help executors avoid costly mistakes.

What Is an Executor?

An executor is the personal representative named in a decedent's will to administer the estate.

Typical responsibilities include:

• locating estate assets;
• paying debts;
• filing tax returns when required;
• distributing property to beneficiaries;
• maintaining estate records; and
• closing the estate.

These duties often require dozens—or even hundreds—of hours of work.

The question naturally follows:

Does Texas law pay executors for this work?

Usually, yes.

Texas's Default Rule: The Five Percent Commission

The Texas Estates Code establishes a statutory commission for many executors.

Section 352.002 provides in part:

"An executor or administrator is entitled to receive a commission of five percent on all amounts the executor or administrator actually receives or pays out in cash in the administration of the estate."

This commission is not based upon:

• the total value of the estate,
• the amount inherited by beneficiaries, or
• the number of hours worked.

Instead, it is based upon cash actually received and paid out during administration.

The Commission Is Not Five Percent of the Entire Estate

This is one of the biggest misconceptions in Texas probate.

Suppose an estate consists of:

• a $700,000 home,
• a vehicle,
• a brokerage account, and
• $40,000 in cash.

If the home passes directly to beneficiaries without being sold, the executor generally does not receive five percent of the home's value merely because it was part of the estate.

Instead, the statutory commission generally applies to qualifying cash transactions handled during administration.

Certain Transactions Do Not Count

The Estates Code also limits what is included when calculating the commission.

For example, executors generally may not receive commissions on:

• cash delivered directly to beneficiaries;
• money already held in the estate before administration in certain circumstances;
• funds merely transferred without administration; or
• transactions specifically excluded by statute.

The commission is therefore often much smaller than many people expect.

Executors Cannot Double Charge

Sometimes an executor is also an attorney.

That creates another important issue.

If an executor hires himself or herself as the estate's attorney, courts carefully examine whether separate attorney's fees are appropriate.

Texas law generally seeks to prevent duplicate compensation for performing essentially the same services.

Legal work and executor work are not always identical, but they also are not automatically separate.

What If the Will Says Something Different?

Many wills address executor compensation directly.

A will may:

• waive compensation;
• set a fixed dollar amount;
• authorize hourly compensation;
• provide greater compensation than the statute; or
• provide less compensation.

Generally speaking, the testator's instructions in the will control unless prohibited by law.

Accordingly, every executor should read the will carefully before assuming the statutory commission applies.

Can a Court Award Different Compensation?

Yes.

Texas probate courts possess authority in appropriate cases to consider reasonable compensation under circumstances recognized by the Estates Code.

Complex estates involving:

• operating businesses,
• extensive litigation,
• mineral interests,
• multiple jurisdictions, or
• extraordinary administrative burdens

may justify compensation issues beyond the ordinary statutory commission.

These questions often require legal guidance and, in some cases, court approval.

Executors Also Owe Fiduciary Duties

Receiving compensation does not lessen an executor's obligations.

Executors owe fiduciary duties to the estate and its beneficiaries, including duties of loyalty, prudence, honesty, and proper accounting.

An executor who improperly pays himself or herself may face:

• objections from beneficiaries;
• surcharge;
• removal by the probate court; or
• personal liability.

For that reason, compensation decisions should be carefully documented.

Practical Advice

If you have been named executor:

• Read the will carefully.
• Keep detailed financial records.
• Document every receipt and disbursement.
• Do not assume you automatically receive five percent of the estate.
• Consult an experienced Texas probate attorney before paying yourself compensation if there is uncertainty.

Likewise, beneficiaries who question executor compensation should understand that Texas law generally allows reasonable statutory commissions—but only under the rules established by the Estates Code.

Conclusion

Serving as executor can be a significant responsibility. Texas recognizes that work by allowing compensation in many estates, but the statutory commission is more limited than most people realize. It is not simply a percentage of everything the decedent owned. Instead, it is governed by detailed provisions of the Texas Estates Code and, in many cases, by the language of the will itself.

Understanding these rules helps executors fulfill their fiduciary duties while reducing the likelihood of disputes among beneficiaries.

Statutory Authority

Texas Estates Code § 352.002 provides in part:

"An executor or administrator is entitled to receive a commission of five percent on all amounts the executor or administrator actually receives or pays out in cash in the administration of the estate..."

At David C. Barsalou, Attorney at Law, PLLC, we help clients navigate business, family, tax, estate planning, and real estate matters ranging from document drafting to litigation with clarity and confidence. If you’d like guidance on your situation, schedule a consultation today. Call us at (713) 397-4678, email barsalou.law@gmail.com, or reach us through our Contact Page. We’re here to help you take the next step.