Child support in Texas has always been a court ordered obligation in Texas divorce and paternity actions. Before implementation of the child support guidelines in the Texas Family Code in the 1980s, child support orders varied from court to court and county to county. However, the enactment of Chapter 154 of the Texas Family Code was the Texas legislature’s attempt to bring uniformity and predictability to child support orders. In doing so, the legislature established “guidelines” which established a method of computing child support which, when net resources are applied to the guidelines, would create an amount which would be “rebuttably presumed” to be in the best interests of the child.
In Texas, the guidelines dictate that child support is a percentage of net resources which includes a laundry list of income and benefits received by a person ordered to pay child support. That person is called an “obligor.” What is and is not classified as net resources can be found in Texas Family Code § 154.062.
(a) The court shall calculate net resources for the purpose of determining child support liability as
provided by this section.
(b) Resources include:
(1) 100 percent of all wage and salary income and other compensation for personal services (including commissions, overtime pay, tips, and bonuses);
(2) interest, dividends, and royalty income;
(3) self-employment income;
(4) net rental income (defined as rent after deducting operating expenses and mortgage payments, but not including noncash items such as depreciation); and
(5) 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, unemployment benefits, disability and workers' compensation benefits, interest income from notes regardless of the source, gifts and prizes, spousal maintenance, and alimony.
(c) Resources do not include:
(1) return of principal or capital;
(2) accounts receivable;
(3) benefits paid in accordance with the Temporary Assistance for Needy Families program or another federal public assistance program; or
(4) payments for foster care of a child.
(d) The court shall deduct the following items from resources to determine the net resources available for child support:
(1) social security taxes;
(2) federal income tax based on the tax rate for a single person claiming one personal exemption and the standard deduction;
(3) state income tax;
(4) union dues;
(5) expenses for the cost of health insurance or cash medical support for the obligors child ordered by the court under Section 154.182; and
(6) if the obligor does not pay social security taxes, nondiscretionary retirement plan contributions.
(e) In calculating the amount of the deduction for health care coverage for a child under Subsection (d)(5), if the obligor has other minor dependents covered under the same health insurance plan, the court shall divide the total cost to the obligor for the insurance by the total number of minor dependents, including the child, covered under the plan.
(f) For purposes of Subsection (d) (6), a nondiscretionary retirement plan is a plan to which an employee is required to contribute as a condition of employment.
There are additional factors for the court to consider but these factors are determined by the Court on a case by case basis. However, income of a spouse cannot be added to an obligor spouse’s net resources.
To aid in the computation, the Attorney General’s Office is charges with annually promulgating tax charts to compute net monthly income, subtracting from gross income social security taxes and federal income tax withholding for a single person claiming one personal exemption and the standard deduction.
The presumption is that net resources shall be multiplied by percentages based upon the number of children that the obligor and obligee have together. These percentages have not changed:
1 child 20% of Obligors Net Resources
2 children 25% of Obligors Net Resources
3 children 30% of Obligors Net Resources
4 children 35% of Obligors Net Resources
5 children 40% of Obligors Net Resources
6+ children Not less than the amount for 5 children
In the 1980s a cap of $6,000 was established which would be applied to the foregoing percentages. In 1995, the cap was raised to $7,500 and beginning September 1, 2013, the cap was raised to $8,550. The legislature imposed the duty of recomputing net resources according to the Consumer Price Index. The 2013 legislature at the Attorney General’s request, based upon research since 1995, made the leap to $8,550 as a cap.
The cap is a guideline and is not a ceiling. The legislature allowed courts to set child support above the guidelines should the court deem such to be in the best interest of the child. Purely as a measuring stick, an obligor would reach the cap for the presumed child support order at an income level of approximately $12,500 per month. So for one child, the presumed child support for an obligor with $8,550 in net resources would be $1,710 per month. Amounts of net resources less than $12,500 per month would also be applied to the applicable percentage.