Imputing Income for Child Support in Texas

Learn why and how courts impute income for child support in Texas.

Whether parents are married to one another or not, they always have a legal obligation to financially support their children. When parents aren't married, the noncustodial parent usually pays monthly child support to the custodial parent to help cover the children's expenses.

Most parents work hard and submit honest information about their income so courts can calculate a fair child support amount. Some parents, however, refuse to provide proof of their income or purposely earn less than their potential income to try and reduce child support. When this happens, courts may use that parent's potential income instead of reported income when calculating child support; this process is called "imputing income."

This article will give you an overview of child support in Texas and explain how courts impute income under Texas law. If you have additional questions about imputed income in Texas after reading this article, contact a Texas family law attorney.

Overview of Child Support in Texas

Compared to most states, Texas calculates child support in a simple and straightforward manner. Courts determine the noncustodial parent's net income by taking that parent's gross income and subtracting taxes, union dues, and money spent on children's health insurance. The court then calculates child support as a percentage of the noncustodial parent's net income, based on the number of children to be supported. To read more about the specifics of child support calculations, read Understanding Child Support in Texas.

Income used in Texas for child support includes the following:

  • salary and wages
  • interest, dividends, and royalty income
  • self-employment income
  • net rental income
  • all benefits received, such as severance pay, retirement, pensions, trust income, annuities, capital gains and other government benefits.

The court can adjust the child support amount up or down if a different amount is in the best interests of the children. When deciding the final amount of child support, Texas courts consider the following factors:

  • ages and needs of the children
  • ability of the parents to contribute to the child's financial support
  • any financial resources available to the child
  • the time each parent has custody of the child
  • work-related childcare expenses
  • alimony support paid for other children
  • custody of other children
  • all other expenses a parent pays on behalf of the children, and
  • any other reason that is in the best interests of the children.

What is Imputed Income?

Imputed income is the amount of income a court uses in child support calculations when it would be inappropriate to use the parent's reported income. Courts impute income when a parent doesn't show reliable proof of his or her income. Courts also impute income when a parent is earning below his or her income potential. For example, if a parent purposely quits a job or takes a job earning less than his or her potential, the court may impute income to that parent to be used in child support calculations. When imputing income, courts use a parent's income potential, as calculated by the court, instead of the parent's actual income in the child support calculations.

The Important Difference Between Voluntary and Involuntary Unemployment

The law in Texas on imputed income is designed to impute income to parents who are willfully refusing to earn their potential income, not parents who are legitimately struggling to find a suitable job. Before imputing income to a parent, courts first determine whether a parent is voluntarily unemployed or underemployed. When determining whether a parent is voluntarily unemployed or underemployed, the court may consider the following factors:

  • the parent's ability to work or disability
  • the parent's previous jobs and earning level
  • the parent's education and job skills, and
  • the parent's obligations (if any) to take care of a disabled child

If the court believes the parent's reason for being unemployed or underemployed is reasonable, the court won't impute income to that parent and will use his or her actual income when calculating child support. If the court doesn't find a good excuse for a parent not earning his or her income potential, however, the court will base child support on imputed income.

In Texas, it doesn't matter if a parent quit a job for reasons other than reducing child support; if a parent quits a job intentionally for any reason, the court may impute income to that parent.

How Does Texas Calculate Imputed Income?

Texas believes that parents' duty to support children is not limited to actual income, but is based on parents' financial ability to pay child support from any and all available sources. A court in Texas will base the impute income amount on what it believes a parent is capable of earning if working to his or her potential.

In Texas, courts assume that every parent has the ability to earn at least the minimum wage ($7.25 in 2013), for a 40-hour workweek. Therefore, imputed income will typically be no lower than $290 per week.

The court can then determine if a parent has the ability to earn more than $290 per week by looking the following factors:

  • a parent's last known income
  • a parent's employment history
  • a parent's education, training, or job skills, and
  • all assets owned by a parent, including assets that don't currently produce income.

Texas courts won't consider past income that is no longer available. For example, if a husband paying child support used to sell art, but there is no longer a market for his paintings, the court won't include that income in imputed income. On the other hand, the court can consider a parent's assets, even if they are non-income producing, when determining child support. For example, a wife with no income, but multiple pieces of property could be ordered to sell one of her properties to pay child support.

Both parents can present evidence of what the paying parent is able to earn for child support purposes. The court will decide on an amount of income to impute to the paying parent, and use that amount to calculate that parent's child support obligation.

Resources

If you have additional questions about imputed income in Texas, contact a Texas family law attorney.

To read the full text of the law on child support and imputed income in Texas, read the Texas Family Code Chapter 154.

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