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Texas Cap on Child Support Guidelines Helps High-Income Earners

Posted on in Child Support

In determining child support, one of the main factors that the judge looks at is each party's income. Their income is then combined for the purpose of comparing it to the child support guidelines.

However, in most states, if the parents' total combined income exceeds $150,000, there are no guidelines for the judge to follow. It is at this point that the court must determine what amount of child support is in the best interests of the minor children.

As you can imagine, this can cause additional conflict during an already contentious point during the divorce proceedings. Fortunately, Texas law is not so arbitrary and there is a cap for how much a person's resources can be used when calculating child support in high-income cases in Texas.

If you and your spouse have a significant amount of combined income, then reach out to the attorneys at the Clark Law Group for guidance during this difficult time in your life.

Net Resources Used for Calculating Child Support in Texas

When calculating child support in Texas, the judge will look at all of your and your spouse's income resources.

According to Section 154 of the Texas Family Code, child support is determined in part by your 'net resources,' which means your 'total earnings, minus Social Security taxes, income taxes for a single person, and dependent health insurance.'

Net resources do not include:

  • Accounts receivable for your business;
  • Foster care payments;
  • Return of principal or capital; or
  • Temporary assistance benefits.

Once net resources are calculated and additional factors considered (such as the number of children, each child's special needs, the recipient spouse's income/work situation), support is be calculated based on a percentage of the obligor's net resources. Typically, an obligor will be forced to pay 20% of his or her income for one child; 25% for two; 30% for three; and so on, with a minimum of 40% for six or more children.

Texas's Cap on Net Resources Used for Calculating Child Support

However, for high-income earners, 20% of their monthly income could be tens of thousands of dollars. Even taking into consideration the lifestyle the child had grown accustomed to, any judge would be hesitant to award such a substantial amount to care for a single child.

Because of this, the state of Texas implemented a child support cap. Prior to 2013, this cap was $7,500; today, however, and until 2019 (when it will be under review again), the cap is $8,550.

What this means is that even if an individual earns $50,000 a month, the courts will base its calculations on just $8,550 of his or her monthly earnings. So, instead of the high-income earner having to pay $10,000 (20% of $50,000) each month for a single child, he or she will only have to pay 20% of $8,550, which comes out to $1,710.

Of course, there are exceptions to this rule, and any good judge will take numerous factors into consideration before settling on an amount. However, if you and/or your spouse are high-income earners, you can rest easy knowing that neither of you will have to fork over tens of thousands of dollars each month to support a single child.

Reach Out to an Attorney

Calculating child support can get tricky in high-income cases. However, if you want to make it through the proceedings with as little conflict as possible, retain the help of one of the lawyers at the Clark Law Group.

Call 469-906-2266 to schedule your consultation with an attorney today.

(image courtesy of Fabian Blank)

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