Why probate costs what it costs
Probate is the court process that proves a will, appoints a personal representative, gives creditors a window to make claims, and authorises distribution to beneficiaries. It costs money in two very different ways. Court costs — filing fees, newspaper publication, certified copies, a bond premium where one is required — are modest and roughly fixed. Compensation for the personal representative and the attorney is neither, because in several states it is set as a percentage of the estate rather than by the hours worked.
California's schedule in Probate Code sections 10800 and 10810 is the clearest and most copied version: 4% of the first $100,000, 3% of the next $100,000, 2% of the next $800,000, 1% of the next $9,000,000 and 0.5% of the next $15,000,000, with anything above $25,000,000 left to the court's discretion. Critically, the personal representative and the attorney each receive that amount, so the schedule is charged twice.
The base is the gross value of the estate accounted for, and gross means gross. Encumbrances are not deducted. A house worth $500,000 with a $400,000 mortgage produces fee on $500,000, not on the $100,000 of equity — which is why a heavily mortgaged estate can generate compensation approaching the whole of its net value.
The fee base is the number that matters
The schedule is fixed; the base is not. Only assets that actually pass through probate enter it, and a great deal of a typical estate does not. Retirement accounts and life insurance with a living named beneficiary pass by contract. Property held in joint tenancy with right of survivorship passes by operation of law. Accounts with a payable-on-death or transfer-on-death designation pass to the named person. Anything held in a properly funded revocable living trust passes under the trust, not the will.
Every dollar moved out of the probate estate is a dollar removed from a base that is charged twice. On the default figures here, $250,000 of non-probate assets removes $250,000 from a $750,000 estate, and in doing so removes $10,000 of compensation — because that band of the schedule is at 2%, charged to both the representative and the attorney. That is the whole economic argument for living trusts in statutory-fee states, and it is a real one, though the trust has to be funded to work: an unfunded trust that names assets it never received leaves those assets in probate.
The percentage falls as the estate grows, because the schedule steps down through its bands. Both fees together come to 8% of a $100,000 estate and 2.26% of a $10,000,000 one. That is regressive in the sense that small estates pay the highest rate, which is why most statutory-fee states also provide a simplified or summary procedure for small estates that avoids the schedule entirely.
Extraordinary services sit outside the schedule. Selling real property, defending a will contest, preparing estate tax returns, running a business, or handling litigation are compensated separately on court approval, and in contested estates they can dwarf the statutory figure. The field on this page exists so you can add a realistic allowance rather than assuming the schedule is the whole bill.
Worked example: a $750,000 estate, a third of it outside probate
The decedent leaves a house, a brokerage account, an IRA with the children named as beneficiaries, and a life insurance policy also with a named beneficiary. The gross estate is $750,000, of which the IRA and the policy account for $250,000. There is $60,000 of debt. The estate is in a state applying the California schedule to both the representative and the attorney. Court costs come to $1,500 and the probate referee charges $1,000.
- Fee base. $750,000 − $250,000 = $500,000. The IRA and the insurance never enter probate.
- First band. 4% × $100,000 = $4,000.
- Second band. 3% × $100,000 = $3,000.
- Third band. The remaining $300,000 falls in the 2% band: 2% × $300,000 = $6,000.
- One statutory fee. $4,000 + $3,000 + $6,000 = $13,000.
- Charged twice. $13,000 to the personal representative and $13,000 to the attorney = $26,000.
- Add costs. $26,000 + $1,500 + $1,000 = $28,500 of administration cost, which is 5.70% of the probate estate.
- What beneficiaries receive. $500,000 − $60,000 of debt − $28,500 = $411,500, plus the $250,000 that passed outside probate directly to the named beneficiaries.
Had the whole $750,000 gone through probate, one statutory fee would have been $4,000 + $3,000 + 2% of $550,000 = $18,000, and both fees $36,000. The beneficiary designations saved $10,000, which is exactly 2% of $250,000 doubled.
How to read the result
Read the percentage before the dollar figure. A total administration cost of 5.70% of the probate estate is at the high end of what people expect, and it comes almost entirely from the schedule being charged twice. In a state that pays reasonable compensation by the hour instead, an uncontested estate of this size is often administered for materially less — and occasionally for more, if it is complicated. The schedule's virtue is predictability, not economy.
Then look at the gap between the gross estate and the fee base. That gap is the only part of this calculation anyone can plan around, and it is planned around before death rather than after. Beneficiary designations cost nothing to add. Joint tenancy is free but carries its own risks, including exposure to the co-owner's creditors and the loss of a full basis step-up. A funded revocable trust costs money to set up and to maintain and avoids probate on everything it holds.
Finally, notice what the fee is not sensitive to: the amount of work. A $2,000,000 estate consisting of one brokerage account and one house pays $33,000 per role on the California schedule whether it takes forty hours or four hundred. A personal representative who is also a beneficiary frequently waives the fee entirely, because compensation is taxable ordinary income to them while an inheritance is not — taking a $13,000 fee and paying tax on it, when the same $13,000 would have come to them tax-free as a share of the residue, is a straightforward loss.
California statutory compensation by estate size
| Probate estate | One fee | Both fees | Both as % of estate |
|---|---|---|---|
| $100,000 | $4,000 | $8,000 | 8.00% |
| $200,000 | $7,000 | $14,000 | 7.00% |
| $500,000 | $13,000 | $26,000 | 5.20% |
| $1,000,000 | $23,000 | $46,000 | 4.60% |
| $2,000,000 | $33,000 | $66,000 | 3.30% |
| $5,000,000 | $63,000 | $126,000 | 2.52% |
| $10,000,000 | $113,000 | $226,000 | 2.26% |
| $25,000,000 | $188,000 | $376,000 | 1.50% |
Court costs, appraisal and extraordinary services are all additional. Above $25,000,000 the schedule stops and the court sets a reasonable amount for the excess.
What people get wrong about probate cost
- Assuming the fee is on net value. The statutory base is gross, before mortgages. A leveraged estate pays fee on the full asset value.
- Forgetting the fee is charged twice. In statutory-fee states the attorney receives the same amount as the personal representative. Halve the schedule and you have understated the cost by half.
- Setting up a trust and not funding it. A revocable trust only avoids probate for assets actually retitled into it. The house that was never deeded over goes through probate anyway.
- Overlooking the small-estate procedure. Most states offer a simplified affidavit or summary administration below a threshold, which skips the schedule entirely. Check the threshold before opening a full probate.
- Ignoring extraordinary fees. A will contest, a real property sale or an estate tax return is compensated on top of the schedule, and a contested estate can spend a multiple of the statutory figure.
- Taking the executor fee without doing the arithmetic. Compensation is taxable ordinary income; an inheritance is not. A beneficiary serving as representative often does better waiving it.
The rest of the estate's arithmetic
Administration cost is separate from and additional to tax. Whether the estate owes federal estate tax depends on a completely different calculation, and administration expenses are themselves deductible in reaching the taxable estate — run the estate tax liability calculator with the total from this page entered as part of debts and expenses. Most estates owe no estate tax at all, so for most families this page is the larger number of the two.
Beneficiaries have their own timetable to manage once distribution happens. Inherited retirement accounts run on distribution rules with their own deadlines and penalties: see the inherited IRA RMD calculator. Assets receiving a stepped-up basis at death carry a different capital gains position from the one the decedent had, which matters as soon as a beneficiary sells — the capital gains tax calculator and the home sale capital gains tax calculator handle the two most common cases.
Where the estate is insolvent, none of this applies: creditors are paid in the statutory order of priority, administration expenses generally come first, and beneficiaries receive nothing. The same claim-priority thinking appears on the living-debtor side in the Chapter 7 means test calculator. And if there is litigation against the estate, the judgment interest calculator will tell you what an unpaid judgment is accruing while the administration runs.
Only some states use a schedule
California, Florida, Missouri and several others set compensation by statute as a percentage of the estate. Most states instead provide for reasonable compensation, reviewed by the court, based on the size of the estate, the complexity of the work and the time spent. Some allow the will itself to fix the amount. Use the flat-percentage option with a figure taken from local practice if you are outside a schedule state, and remember that reasonable compensation is a ceiling for argument rather than an entitlement: the court can and does reduce it.