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Are Overtime & Benefits Included When Calculating Child Support?

On Behalf of | Mar 24, 2023 | Child Support, Overtime Pay

Will My Overtime Pay and Benefits Be Included in My Income for the Purpose of Calculating Child Support? 

Parents have a responsibility to support their children and that responsibility does not change in divorce. The determination of child support calculation is important for any parent who may be responsible for making these payments during or following a divorce.

What Does Texas Law Say About Income in Child Support? 

Texas Family Code clarifies in Section 154.062 that the court calculates net resources for the purpose of determining child support liability with 100% of all salary and wage income and other compensation for personal services. This includes additional pay such as overtime, commissions, bonuses, and tips. This means that any and all of your wage and salary income is used for determining child support in Texas.

Working with a qualified Texas family lawyer is the best way to understand how this calculation affects you and to present overtime to a court as an average across the entire year. This is typically done through tax documents that show your average monthly salary amount.

In the event that you already have a child support order in place and there is a significant change in your overtime pay, your attorney should help you decide whether or not this is substantial enough to ask for a modification in child support.

Understanding Gross Income in Child Support Cases 

The court looks at the annual income of an individual and divides this by 12 to arrive at an average gross monthly income. This incorporates all wages as stated above including things such as net rental income, income from dividends interests and royalties, self-employment income, salary, wages and overtime pay, any other income such as capital gains benefits, social security benefits, or annuities, and other sorts of income like disability, workers compensation, alimony, prizes, gifts and pensions.

Child support evaluations start with the categorization of gross income. At that point, however, child support must be determined from net income. Net income is your gross income minus any approved deductions. Approved deductions include things such as federal income taxes, Medicare and social security taxes, state income tax, union dues, and any health insurance funds that apply to your shared children. After these deductions have been subtracted, the net income number remaining is used to calculate child support.

How Much Does a Non-Custodial Parent Typically Pay?

The factors listed above will be included in the child support evaluation, but the average non-custodial parent will owe approximately 20% of their net income to the custodial parent that is in support of one child. This percentage goes up by 5% for every additional child up to five children total.

The purpose of taking this approach is to represent the best interests of the children involved. This means that the state does not alter any child support payments in accordance with how much time that non-custodial parent spends with his or her children. Judges do have some discretion in making child support determinations, however, which is why it is so important to work with a qualified Texas family lawyer to help you.

Noncustodial parents with children in several households may have a child support order adjusted to account for this.

Are There Any Wage Caps for Net Income Calculations?

Periodically lawmakers in Texas will modify the Texas wage cap for inflation for those non-custodial parents who earn significant money. This means that only in rare situations will the courts order child support payments beyond 20% of the parent’s net income plus 5% for every additional child. In 2019, this cap was increased to $9,200.

What if a Non-Custodial Parent is Unemployed? 

If a non-custodial parent is intentionally underemployed or unemployed, the court can make adjustments for these concerns. If the court determines, for example, that the non-custodial parent is choosing to work for less than they are capable of earning in the market, the calculation factors may be altered to arrive at a more representative income. In the event that the non-custodial parent has no employment whatsoever, the court will calculate a standard 40-hour work week amount at the federal minimum wage.

What Deductions Aren’t Considered When Calculating Your Income? 

Child support payments are calculated by looking at your take home pay. For example, this means that money that goes into your 401k rather than into your bank account is not considered as a deduction when determining how much you owe for child support.

How is Child Support Paid in Texas?

If you’re ordered to pay child support in Texas, it can be paid in one of a few ways:

  • Deduction directly from your paycheck (income withholding)
  • Online through electronic payment methods
  • Money or check submitted through the State Disbursement Unit

However, most Courts now require that child support be deducted directly from your paycheck.

Penalties may apply if a parent refuses to pay their ordered child support. If the person knowingly or intentionally fails to provide payment, that parent may face criminal non-support charges.

Failing to pay child support can also lead to other consequences, such as:

  • Having your wages garnished to make child support payments
  • Having a lien put against your property
  • Losing your driver’s license or professional license
  • Being blocked from getting a passport
  • Having your tax refund seized
  • Your credit score going down due to back due child support
  • Having to pay the other party’s attorney’s fees

Why Do I Need a Child Support Lawyer?

Even though many facets of Texas child support are handled based on calculations and set factors, you may need a lawyer to help make the case for more or less child support depending on your situation. You can request this through a modification of child support order. When you have a Texas family lawyer at your side to help you with each aspect of your case, you’ll be more clear about your rights and responsibilities and understand if and when you can change an order.

Let Houston family lawyer Lacey N. Richmond help you with getting or adjusting a Texas child support order. Reach out to schedule a consultation.