Detailed Answer
Under Colorado law, a personal representative (PR) may request reasonable compensation for managing an estate. Compensation typically comes in the form of commissions calculated on the gross value of estate assets collected, managed, distributed, or sold. These rules appear in the Colorado Probate Code: C.R.S. § 15-12-706 and the commission schedule in C.R.S. § 15-12-706.5.
1. Commission on Estate Assets
A PR may receive commissions based on the gross value of all probate assets. The court-approved schedule in C.R.S. § 15-12-706.5 allows:
- 4% on the first $100,000;
- 3% on the next $100,000;
- 2% on the next $800,000;
- 1% on the next $9,000,000; and
- 0.5% on the amount over $10,000,000.
2. Commission on Sale Proceeds
If the PR sells estate property (real estate, investments, or personal property), they may earn a commission on the gross sales price under the same statutory rates unless the will waives commissions or beneficiaries object. Commissions on sales must be clearly disclosed in the PR’s accounting to the court.
3. Court Approval and Objections
The PR submits a petition or final accounting listing all commissions sought. Interested parties may review and object. The probate court then approves, modifies, or denies the proposed compensation. If beneficiaries dispute the amount, the court holds a hearing before making a final order.
4. Alternative Fee Arrangements
Instead of commissions, the PR can ask the court to approve compensation based on a reasonable hourly rate along with documented time entries. The court may award this alternative under C.R.S. § 15-12-706(2).
Key Statutes
- C.R.S. § 15-12-706 – General rule on PR compensation and allowance for hourly fees.
- C.R.S. § 15-12-706.5 – Statutory commission schedule.
Disclaimer: This article provides general information and does not constitute legal advice. Always consult a qualified attorney for your specific situation.
Helpful Hints
- Review the decedent’s will to see if it waives or modifies PR commissions.
- Keep detailed records of all estate transactions and sales.
- Discuss proposed compensation with beneficiaries before filing your petition.
- Consider seeking approval for hourly fees if estate administration becomes complex.
- File your accounting and compensation petition early to avoid delays at closing.