Can a Trustee Get Paid in California? Understanding Trustee Compensation
Serving as trustee is often a full-time job for months at a time. You may be managing property, paying bills, handling taxes, keeping records, and dealing with beneficiaries — all while trying to avoid personal liability. Naturally, one of the most common questions is: “Do trustees get paid?”
The answer is almost always yes. The trust will specify whether it is hourly, percentage, or most commonly, "reasonable compensation." Let's break it down:
How Trustee Compensation Works
Trustee compensation typically falls into one of these categories:
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Hourly Fees
Trustees (especially professional fiduciaries or attorneys) may bill hourly for their time. This works best when the trust requires ongoing work, like managing rentals or complex investments. -
Percentage of the Trust Assets
Some trusts (or courts) allow payment based on a percentage of the assets managed or distributed. -
Reasonable Compensation
Most often, a California trust will simply say that the trustee is entitled to "reasonable compensation."
Who Decides What Is “Reasonable”?
California Probate Code doesn't set a strict dollar amount. Instead, if challenged by a beneficiary, the court decides and will look at factors such as:
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The size and complexity of the trust
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The skill and experience required
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The time spent by the trustee
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The results achieved for the beneficiaries
In other words, “reasonable” for a simple trust with one bank account will look very different than “reasonable” for a multimillion-dollar trust with real estate, businesses, and multiple beneficiaries.
Do Beneficiaries Have a Say?
Beneficiaries have the right to review trustee compensation. If they believe the fees are excessive, they can object — which may lead to a court review.
This is why transparency matters. Trustees should disclose how compensation is calculated and document the time and work performed.
Key Takeaways for Trustees and Beneficiaries
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Trustees are entitled to be paid for their time and effort.
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The trust document may provide guidance, but if not, California law defaults to “reasonable compensation.”
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Documentation is critical — trustees should keep diligent records to justify their fees. Keep detailed notes on dates, hours, and task(s) accomplished.
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Beneficiaries should expect to see trustee compensation explained as part of the accounting.
Bottom Line
Trustee compensation is both allowed and expected, but it must be fair and properly documented. Clear communication can prevent disputes before they begin.
At Finlay Law Group, we help trustees understand their rights, ensure their fees are reasonable, and guide beneficiaries through reviewing compensation as part of the trust administration process. If you're a trustee or a beneficiary with questions about compensation, contact us today.
Disclaimer: The above information is intended for information purposes alone and is not intended as legal advice. Please consult with counsel before taking any steps in reliance on any of the information contained herein.