Texas has a ‘soft cap’ on child support, which means that there is sort of a maximum level of child support that a person can be ordered to pay. There are ways to exceed this cap, but that is rare. The ‘soft cap’ is equal to someone making $140,000/year and translates to $1,710/month for one child.
Texas looks almost solely at the income of the person paying child support. The most common reason for exceeding this cap is that a child has a disability that requires additional expenses. The next most common reason is very young children who require daycare instead of being in school.
Here is an example. Sarah and Jason Andrews have been married for twenty years. They have twins. In their free time, they like to spend time with their extended family. Sarah is a teacher, while Jason is an executive at a major oil company. They reside in a quiet suburb of a big Texas city. For the past three years, they have grown increasingly unhappy in their marriage. They have both individually thought about seeking a divorce, but they have been reserved about doing so because they are apprehensive about issues such as child support.
Specifically, Jason often wonders how much support he will have to pay if he and Sarah divorced. How is child support calculated in Texas? What is the cap on the amount that an obligor (the parent that pays it) would be ordered to pay? We will discuss the way it is calculated in Texas below.
Calculating Child Support
A support payment is calculated based on the guidelines set in the Texas Family Code. The child support guidelines are presumed to be in the best interest of the child. This is a percentage of the paying parent’s (or obligor parent’s) net income, starting at 20% for 1 child and going up 5% for each additional child. We will discuss the calculation of support below.
Texas Child Support Guidelines
The amount of support that you may be required to pay in Texas will depend on several factors. Some of the factors include the following:
- Your income; and
- The amount of children you have; and
- The needs of your children.
According to the Texas Family Code Child Support Guidelines, the support cap will be determinate upon the net resources of the obligor parent. This means that the amount of support that an obligor parent is ordered to pay will be based on the obligor parents’ “net resources.” So, what all does net resources consist of?
What are net resources? According to the Texas Family Code Section 154.062 (b), net resources shall include all of the following:
- 100 percent of all wage and salary income and other compensation for personal services (including commissions, overtime pay, tips, and bonuses);
- Interest, dividends, and royalty income;
- Self-employment income;
- Net rental income (defined as rent after deducting operating expenses and mortgage payments, but not including non-cash items such as depreciation); and,
- All other income actually being received, including severance pay, retirement benefits, pensions, trust income, annuities, capital gains, social security benefits other than supplemental security income, United States Department of Veterans Affairs disability benefits other than non-service-connected disability pension benefits, as defined by 38 U.S.C. Section 101(17), unemployment benefits, disability and workers’ compensation benefits, interest income from notes regardless of the source, gifts and prizes, spousal maintenance, and alimony.
On the other hand, according to the Texas Family Code Section 154.062(c), net resources do not include:
- Return of principal or capital; or
- Accounts receivable; or
- Benefits paid in accordance with the Temporary Assistance for Needy Families program or another federal public assistance program; or
- Any payments for foster care of a child.
Child Support Cap
Moreover, to promote fairness, equality in outcomes, and to provide guidance in structuring support payments, The Texas Family Code, Section 154.124 provides a child support chart. The chart indicates that there are a minimum and maximum amount of child support that will be ordered for an obligor parent.
The chart contains the subsequent information: If the obligor parent has only one child to render support to, then the obligor’s support payment will be based on 20% of the obligor’s net resources.
If the obligor parent has two children to render support to, then the obligor’s support payment will be based on 25% of the obligor’s net resources. Further, if the obligor parent has three children to render support to, then the obligor’s support payment will be based on 30% of the obligor’s net resources. If the obligor parent has five children or more than the obligor’s support payment will be typically based on 40% of the obligor’s net resources.
Texas Family Code, Section 154.125 requires that the amount of support will be adjusted every 6 years to compensate for inflation. Also, pursuant to the Texas Family Code, Section 154.129, if there are children in more than one household, then the court will use an alternative method for computing the support for the child.
The child support cap is calculated based on the guidelines listed in the Texas Family Code. Those guidelines are based on the number of children that an obligor parent has as well as the net resources of the obligor parent. The net resources of an obligor parent typically mean all of the income that the obligor parent receives.