In a Texas divorce or custody case, the Family Code uses a formula based on several definitions enacted by the Texas Legislature to calculate child support. But judges have discretion when the facts presented warrant a different outcome. First, the definitions of earnings is very broad. It includes any payment to or due an individual, regardless of the source. Disability and retirement benefits, lump sums, independent contractor payments, bonuses and interest income are included in this definition.
After earnings are determined and the gross monthly amount is found, next the court looks at the disposable earnings of the person. The court can exclude certain mandatory deductions such as federal and state income taxes, Social Security and Medicare withholding, union dues and nondiscretionary retirement contributions. Health insurance for the ren of the person paying is also excluded.
But the formula is not quite that simple. The payment amount is based on net resources. That amount derives from looking at the gross monthly wages of the paying parent but applying a tax rate of a single individual, claiming one exemption and the standard deduction. So a parent who is remarried with another kid/kids cannot look at her W-2, where she claims 4 deductions, and accurately calculate her payment obligation for her child from her prior marriage, without knowing the formula. Additionally, although the percentage per child is straightforward when neither party has other children: 20% for 1; 25% for 2; 30% for 3 and 35% for 4; if either party has a legal duty to pay for other children, there are adjustments made to the formulas. And stepchildren do not count.
Health insurance premiums paid by the paying parent are deducted from the payment. If the paying parent does not provide health insurance, the premium is added on to the financial obligation.
This article is published by on 2016-01-13 Find us on Google+