Disclaimer: This article provides general information about South Dakota probate law and does not constitute legal advice. Consult a licensed attorney to address your specific situation.
Detailed Answer
In South Dakota, a personal representative (also called an executor or administrator) may request compensation for administering an estate. The court must approve any fees. SDCL 29A-3-714 grants the personal representative a right to reasonable compensation. The probate court reviews factors such as the size and complexity of the estate, the value of assets, and the time required to settle the estate.
When the personal representative sells estate assets—such as real property or personal property—they may include any resulting sale proceeds in their compensation calculation. There is no separate statutory formula in South Dakota for commissions on sales; instead, the overall fee must be “reasonable” under SDCL 29A-3-716, which requires court approval. The court considers whether the sale was in the estate’s best interest, the fair market value of assets at the time of sale, and customary local rates.
To secure approval, the personal representative must file a petition with the probate court (often called a “Petition for Allowance of Compensation”), attach detailed records of assets administered and sales completed, and propose a compensation amount. Heirs and creditors receive notice and may object. After any objections resolve, the court issues an order establishing the compensation.
Example: Jane Doe serves as personal representative for her father’s estate. She inventories $500,000 in assets, sells real estate for $250,000, and distributes funds to heirs. Jane petitions for a fee equal to 3% of the gross estate ($750,000), or $22,500. The court examines estate complexity, time invested (50 hours), and local norms, then approves a reasonable fee of $20,000.
Helpful Hints
- Review South Dakota probate rules and local court procedures before filing.
- Keep detailed records of all estate assets, sales, and hours worked.
- File a Petition for Allowance of Compensation early in the probate process.
- Provide clear notice to heirs and creditors and allow time for objections.
- Be ready to justify your fee based on estate size, sale proceeds, and complexity.
- Discuss proposed fees informally with beneficiaries to minimize objections.
- Consult a probate attorney to ensure your request aligns with local practice.