If you have been named a successor trustee in California, one of your first questions is likely how much a trustee can charge for the work involved. The short answer: it depends on what the trust document says, and if it says nothing, on what a court would consider reasonable.
What Trustee Compensation Actually Means
Trustee compensation is payment for the time, responsibility, and skill required to properly administer a trust: gathering assets, paying debts, filing tax returns, and eventually distributing property to beneficiaries. Whether a fee is appropriate often depends on who is serving.
Put Simply: A professional trustee (a bank, trust company, or attorney) manages trusts as their occupation and typically charges an ongoing fee based on published schedules. A non-professional trustee (a family member or friend) is not in the business of trust administration but is still entitled to fair payment for real work performed, not simply a token thank-you.
California's Statutory Trustee Fee Rules
California does not use a fixed percentage table for trustee fees as it does for personal representatives in probates. Instead, California Probate Code Section 15680 makes the trust document the first authority: if it specifies compensation, that term generally controls. Section 15681 fills the gap when the trust is silent, providing the trustee is entitled to reasonable compensation under the circumstances.
If a dispute regarding trustee fees reaches the courthouse, judges look to the factors in California Rule of Court 7.776 rather than a formula. These include the trust's size and complexity, the skill required, the customary rate for similar corporate trustee services in the community, the trustee's performance, and whether any breach of fiduciary duty occurred.
How Fees Are Typically Calculated
Successor trustee compensation in California generally follows one of two approaches:
- Hourly rate: Common for non-professional trustees, and often the fairest measure for one-time or short-term administrations.
- Percentage of trust assets: More common among professional and corporate trustees, often tiered so the percentage decreases as the trust's value increases.
Several factors influence the final total: the number and complexity of assets, whether real property and/or a business must be managed, the number of beneficiaries, tax filings required, and whether litigation or family conflict adds to the workload. A simple, single-asset trust naturally commands a lower average fee for a successor trustee than a multi-property estate with contested distributions.
A trustee who wants to raise compensation above what they have previously been paid must give beneficiaries 60 days' written notice under Probate Code Section 15686, and a beneficiary may petition the court under Section 17200 to review any fee believed to be excessive.
Documenting and Justifying Your Fees
The best protection against a dispute is a clear, contemporaneous record. Keep a log of hours worked, tasks performed, and decisions made as you go, rather than reconstructing it later. Retain correspondence with beneficiaries, copies of accountings, and receipts for any trust-related expenses. When your fee reflects real, well-documented work, beneficiaries have far less reason to question it, and you have the evidence a court would expect to see if they do.
When to Consult an Attorney About Trustee Compensation
Some situations call for guidance beyond a general understanding of the rules: high-value or multi-property trusts, disagreements among beneficiaries about what is fair and reasonable, co-trustee arrangements where compensation must be divided, or any trust administration heading toward litigation. Trust administration fees in San Diego can vary significantly based on these factors, and a fee that feels reasonable to you may not hold up without proper support.
At Brierton, Jones & Jones, LLP, we have spent more than 30 years helping trustees across San Diego County administer trusts with integrity and excellence, including guidance on fair, defensible trustee compensation. Whether you are a family member serving for the first time or a professional fiduciary managing a complex estate, we can help you set a fee structure that protects both you and the beneficiaries you serve.
Schedule a Consultation to talk through your specific situation with our trust administration team.