How Much Does an Executor Get Paid in NC?

Probate Questions 14 min read

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Serving as executor of a loved one’s estate is one of the most demanding roles most people will ever take on. It involves months of paperwork, phone calls, financial decisions, and emotional labor that no one fully appreciates until they are in the middle of it. One question that comes up early and often is whether you are entitled to be paid for this work, and if so, how much.

Important: This guide provides general information about North Carolina probate procedures. It is not legal, tax, or financial advice. Every estate is different. Consult a qualified attorney or tax professional for advice specific to your situation.

Afterpath provides clear, NC-specific guidance on executor compensation and estate accounting. Our Pathfinder AI guide explains the statutory formula in plain English and helps you calculate your estimated commission. Our NC Compliance Engine tracks receipts and disbursements so your compensation claim is accurate, and our task management system ensures every step of the accounting process stays on schedule.

The Short Answer: NC Uses a 5% / 5% Formula

North Carolina law provides a straightforward formula for executor compensation. Under NC General Statute 28A-23-3, an executor (called a “personal representative” in the statute) is entitled to a commission of:

Up to 5% of estate receipts (money that comes into the estate)
Up to 5% of estate disbursements (money that goes out of the estate)

This is sometimes called the “double 5%” or the “5/5 formula.” It applies to the total amounts received and disbursed during the administration of the estate, not to the total value of the estate at the time of death.

What Counts as Receipts

Receipts include all money and property that comes into the estate during administration:

Cash in bank accounts at the time of death
Proceeds from selling real property, vehicles, or personal property
Income earned by estate assets (interest, dividends, rent)
Life insurance proceeds payable to the estate (not to named beneficiaries)
Retirement account distributions payable to the estate
Debts owed to the deceased that are collected
Tax refunds received by the estate

What Counts as Disbursements

Disbursements include all money paid out by the estate:

Debts and creditor claims paid
Funeral and burial expenses
Court costs and filing fees
Attorney and CPA fees
Tax payments (income, property, estate)
Distributions to beneficiaries
Maintenance costs for estate property (insurance, utilities, repairs)

A Practical Example

Suppose you are serving as executor for your mother’s estate. During administration, you collect:

$120,000 from her bank accounts
$180,000 from selling her home
$3,000 in interest and dividends

Total receipts: $303,000

You then pay out:

$15,000 in funeral expenses
$8,000 in medical bills
$4,500 in attorney and CPA fees
$6,000 in taxes
$2,500 in property maintenance
$267,000 distributed to beneficiaries

Total disbursements: $303,000

Your maximum statutory commission would be:

5% of $303,000 (receipts) = $15,150
5% of $303,000 (disbursements) = $15,150
Total maximum commission: $30,300

That is not a trivial amount, and it reflects the significant work involved in managing a $303,000 estate through the full probate process.

“Up To” 5% – The Clerk Has Discretion

An important detail that many executors miss: the statute says “up to” 5%. The commission is not automatic. The Clerk of Superior Court must approve the compensation, and the Clerk has discretion to approve a lesser amount if the circumstances warrant it.

In practice, the full 5%/5% is routinely approved for estates where the executor has performed the standard duties of estate administration. The Clerk is more likely to reduce the commission if:

The estate was very simple and required minimal effort
A co-executor is claiming a share but did little actual work
A beneficiary objects and can show the executor’s work was minimal
The executor made significant errors that required correction

For most estates, if you have done the work competently, the Clerk will approve the full statutory amount.

How to Claim Your Commission

You do not simply take your commission from the estate account. The process requires:

Complete the estate accounting. File the Final Account or Annual Account with the Clerk of Superior Court showing all receipts and disbursements.
Include the commission request. Your accounting should show the commission as a disbursement. Some executors list it as a pending disbursement pending Clerk approval.
The Clerk reviews and approves. The Clerk examines the accounting and approves the commission amount.
Pay yourself from the estate account. Once approved, you take the commission from estate funds.

Afterpath’s NC Compliance Engine walks you through this accounting process step by step. It automatically categorizes receipts and disbursements as you enter them and calculates your commission using the statutory formula, so the numbers are ready when you prepare your filing.

When the Will Specifies Compensation

Sometimes the will itself addresses executor compensation. The deceased may have included language such as:

“I direct that my executor receive compensation of $10,000 for services rendered.”
“My executor shall receive reasonable compensation as permitted by law.”
“My executor shall serve without compensation.”

If the will specifies a compensation amount, that amount generally controls instead of the statutory formula. However, the executor is not required to accept a lesser amount specified in the will. Under NC law, the executor can renounce the will’s compensation provision and claim the statutory commission instead.

If the will says the executor should serve without compensation, the executor can still claim the statutory commission by renouncing that provision. The renunciation must be done formally and before the executor has accepted any compensation under the will’s terms.

This is a situation where consulting an attorney is worthwhile, particularly if the will’s compensation terms differ significantly from what the statutory formula would provide.

Tax Implications of Executor Compensation

Executor compensation is taxable income. This is true whether you are a family member or a professional. The tax treatment works as follows:

For the Executor

Federal income tax: Executor compensation is reported as ordinary income on your personal tax return. If you are not a professional executor, report it on Schedule 1 (Form 1040) as “Other income.” If you are a professional executor (attorney, CPA, trust company), report it as business income on Schedule C.
Self-employment tax: This depends on whether you serve as executor in a professional capacity. If you are a family member serving as executor for one estate, the IRS generally does not require self-employment tax. If you are a professional who regularly serves as executor, the compensation is subject to self-employment tax.
NC income tax: Executor compensation is subject to NC income tax at the flat rate (4.25% for 2025).

For the Estate

Deductible expense: Executor compensation is a deductible administration expense on the estate’s income tax return (federal Form 1041 and NC Form D-407). This reduces the estate’s taxable income.
Not deductible on the estate tax return: While executor compensation is deductible for income tax purposes, it cannot be deducted on both the estate income tax return and the federal estate tax return (Form 706). The executor must choose where to take the deduction.

The Tax Trade-Off

Here is where it gets strategic. Taking executor compensation creates a tax deduction for the estate but creates taxable income for you. Whether this saves money overall depends on comparing the estate’s tax rate to your personal tax rate.

If the estate is in a high federal income tax bracket (estates hit the top 37% bracket at just $14,450 of taxable income) and you are in a lower bracket, taking the compensation can shift income from the estate’s higher rate to your lower rate. This is a conversation to have with a CPA before the estate’s tax year closes.

Waiving Compensation: When and Why Executors Choose Not to Claim

Many family executors choose to waive their compensation entirely. This is especially common when:

The executor is the sole beneficiary. If you are inheriting the entire estate, taking a commission means paying income tax on money you would have inherited tax-free. Inheritances are generally not taxable income. Executor compensation is. In most cases, it makes better financial sense to waive the commission and take the full inheritance.
The executor is one of several equal beneficiaries. If three siblings split the estate equally and one is the executor, taking a commission reduces what the other two siblings receive. This can create resentment even though the executor is legally entitled to the payment.
The estate is small. If the estate totals $50,000, the maximum commission would be about $5,000. Some executors in small estates decide the family friction is not worth the amount.
Family harmony matters more. Even when the law is clear, family dynamics are complicated. Some executors waive compensation to avoid any perception that they profited from their parent’s death.

When You Should Claim Compensation

Waiving compensation is a personal choice, but there are situations where claiming it is entirely appropriate and even advisable:

The estate is large or complex. Administering a multi-hundred-thousand-dollar estate with real property, business interests, or contested claims is genuinely difficult work. You are entitled to be compensated.
The work extends over many months. If the estate takes a year or more to settle, you are investing significant time and energy that has real value.
You are not a beneficiary. If you are serving as executor for a friend or distant relative and not inheriting anything, you should absolutely claim your commission.
You are incurring out-of-pocket costs. While you can be reimbursed for reasonable expenses separately from compensation, the overall burden of serving may justify the commission.

Multiple Executors: Splitting the Commission

When the will names co-executors, the statutory commission does not double. The total commission remains at 5%/5%, and the co-executors split it among themselves. The typical split is equal, but the Clerk can approve an unequal split if one co-executor did significantly more work than the other.

This creates a common source of conflict. If two siblings are named co-executors and one handles 90% of the work while the other checks in occasionally, the working executor may want a larger share. The Clerk can consider the division of labor when approving the split, but it requires the working executor to document what they did.

If you are serving as co-executor, keep detailed records of your time and activities. Afterpath’s task management system creates a built-in log of every action you complete during estate administration, which serves as documentation if you need to justify your share of the commission.

Reasonable Expenses vs. Compensation

Executor compensation and executor expense reimbursement are two separate things. You are entitled to both.

Compensation is the statutory commission for your service as executor. It is taxable income.

Expense reimbursement covers out-of-pocket costs you incur while administering the estate:

Mileage to and from the courthouse, bank, and attorney offices
Postage and shipping costs
Storage fees for estate property
Long-distance phone calls related to estate business
Copying and printing costs
Travel expenses if estate property is in a different location

These reimbursements are not taxable income to you because you are being made whole for money you spent on behalf of the estate. They are deductible expenses of the estate.

Keep receipts for everything. The Clerk may ask to see documentation of expenses as part of the accounting review. Afterpath’s Document Vault provides a secure place to store receipts and expense records throughout the administration process, so nothing gets lost between the kitchen junk drawer and the courthouse.

For a deeper look at expense reimbursement, see our guide on executor out-of-pocket expenses in NC.

What If a Beneficiary Objects to the Commission?

Beneficiaries have the right to object to the executor’s compensation when the accounting is filed with the Clerk. Common grounds for objection include:

The estate was simple and the commission is disproportionate. If the estate consisted of one bank account and no debts, a beneficiary might argue the full 5%/5% is excessive for the minimal work involved.
The executor performed poorly. If the executor made costly mistakes, delayed the process unnecessarily, or failed to fulfill duties, beneficiaries can argue the commission should be reduced.
The executor is also an attorney billing separately. If the executor is an attorney and is also billing the estate for legal services, a beneficiary might object to paying both attorney fees and the full executor commission.

The Clerk considers objections and makes a determination. If you anticipate objections, having thorough records of your work and the time you invested strengthens your case.

Professional Executors and Attorney Compensation

When a professional (typically an attorney or a trust company) serves as executor, different norms apply. Attorneys who serve as executor may charge their standard hourly rate instead of claiming the statutory commission if their hourly fees exceed the 5%/5% amount. However, they cannot charge both their hourly rate as an attorney and the full executor commission for the same work.

Trust companies and corporate executors typically charge fees based on a percentage of estate assets, often between 1% and 3% annually. These fees are negotiated in advance and specified in the trust or estate plan.

If the deceased named a professional executor, the estate’s beneficiaries should review the fee arrangement carefully and object if it seems unreasonable.

Frequently Asked Questions

Does the executor have to claim compensation?

No. Claiming the statutory commission is optional. Many family executors waive compensation, especially when they are also beneficiaries. If you choose to waive, you should document that decision in writing as part of the estate records.

Can an executor pay themselves before the Clerk approves?

No. Taking compensation without Clerk approval is improper and can be grounds for removal. File the accounting, include the commission request, and wait for the Clerk to approve before taking payment. Afterpath’s NC Compliance Engine flags this step so you do not accidentally take compensation prematurely.

Is executor compensation the same as inheritance?

No. They are legally and tax-wise completely different. Inheritance is a distribution of estate assets to a beneficiary and is generally not subject to income tax. Executor compensation is payment for services rendered and is taxable income. If you are both executor and beneficiary, understand this distinction before deciding whether to claim the commission.

Can Afterpath help me calculate my executor compensation?

Yes. Afterpath’s NC Compliance Engine tracks all estate receipts and disbursements as you enter them throughout the administration process. It automatically calculates your maximum statutory commission using the 5%/5% formula and prepares the figures you need for the accounting filing. Pathfinder can also answer specific questions about whether particular transactions count as receipts or disbursements for commission purposes.

What if the will says I should serve without pay?

You are not bound by that provision. Under NC law, you can renounce the will’s compensation terms and claim the statutory commission instead. This must be done formally. Consult an attorney if you are in this situation, as the timing of the renunciation matters.

Moving Forward

Executor compensation in North Carolina is more straightforward than many people expect. The 5%/5% formula gives you a clear ceiling, the Clerk approval process provides oversight, and the law protects your right to be paid for genuine work.

Whether you choose to claim your commission or waive it is a personal decision that depends on the size of the estate, your relationship to the beneficiaries, and your own financial situation. There is no wrong answer, as long as you make the decision with full information about the tax implications and family dynamics involved.

What matters most is that you fulfill your duties competently and keep meticulous records. The compensation question takes care of itself when the work is done well.

Afterpath was built for exactly this moment – to turn the overwhelming complexity of estate administration into a clear, manageable process. Our Pathfinder AI guide is available 24/7 to answer your compensation questions, our task system tracks every deadline, and our NC Compliance Engine ensures your accounting is accurate and complete.

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