2.9 Waiver of Executor’s and Trustee’s Commissions

Commissions received by an executor for services performed are taxable as compensation. An executor may waive commissions without income or gift tax consequences by giving a principal legatee or devisee a formal waiver of the executor’s right to commissions within six months after the initial appointment or by not claiming commissions at the time of filing the usual accountings.

The waiver may not be recognized if the executor takes any action that is inconsistent with the waiver. An example of an inconsistent action would be the claiming of an executor’s fee as a deduction on an estate, inheritance, or income tax return.

A bequest received by an executor from an estate is tax free if it is not compensation for services.