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Overseas income vs low income in child support payments

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cutmon80

Junior Member
What is the name of your state (only U.S. law)?

north carolina(dad) and texas(2 kids)

I make between $30K-35K per year(NC). Kids mom makes circa $40-45K. My child support for many years, for the two(TX), has been $320/mo. Just recently, my wife and I had a baby boy. The twins are 13. Im about to start work overseas with US contractor paying $160K/year. The IRS says the first $90-91K is tax free, and then the rest is taxed for fed/state. The TX state has already done an automatic "check-up", on mom and dad. nothing changed. next automatic "check-up", is in 2-3yrs.

1-Whenever the child support changes with my new income of $160K, and the moms income at 45K, can someone help me figure out the total cost of child care for the combined incomes, and of course my share for child support?

2-After my contract is up, and i'm making a lower income again, is it as simple as me filing with TX, to "redo" the numbers, since there would be a drastic change of circumstances/income?

3.-When does my child support end with TX? after high school graduation, or age 18, or after college.

thnx evryone and ALL parents!
 


CJane

Senior Member
What is the name of your state (only U.S. law)?

north carolina(dad) and texas(2 kids)

I make between $30K-35K per year(NC). Kids mom makes circa $40-45K. My child support for many years, for the two(TX), has been $320/mo. Just recently, my wife and I had a baby boy. The twins are 13. Im about to start work overseas with US contractor paying $160K/year.
Congratulations on the child and the new job! How exciting! My little sister is about to start working overseas as a contractor as well.

How is the pay structured? For example, what is the SALARY amount, and how much is "living expenses" or other non-salary income?

Is this a 2 year contract? 3 years?

The IRS says the first $90-91K is tax free, and then the rest is taxed for fed/state.
That's really excellent for you. $90K tax-free is really a lot more like... $150K if it were taxed? And then you'll be paying taxes on $70K? Sounds to me like your "salary" is $70K and the remaining $90K or so is the additional non-salary pay. Right?

Just so you know, what the IRS considers income, and what the child support guidelines consider income have nothing to do with each other.

1-Whenever the child support changes with my new income of $160K, and the moms income at 45K, can someone help me figure out the total cost of child care for the combined incomes, and of course my share for child support?
For children who are 13, it's unlikely that "child care" will be a factor. And, Texas does not consider the income of the custodial parent when setting the child support amount -- only the non-custodial parent. Mom could make $300K/year and it would make no difference to your obligation.

2-After my contract is up, and i'm making a lower income again, is it as simple as me filing with TX, to "redo" the numbers, since there would be a drastic change of circumstances/income?
Nothing is ever "as simple" as anything, is it? A reduction is generally more difficult to achieve than an increase. You will have shown that you're "capable" of making the higher salary -- albeit out of country -- and therefore will have to justify the reduction in salary and show that it's not voluntary. Which is difficult.

This is from the OAG's website:

It is possible that your child support order could change to match your current income. If you are unemployed and have no source of income when our office reviews your child support order, we generally will calculate a modified child support amount that considers your past employment, your ability to work and earn an income, and the current federal minimum wage.

3.-When does my child support end with TX? after high school graduation, or age 18, or after college.
Does your child support or custody order address this at all?

If not, child support in Texas ends at 18 OR upon the graduation of the child from high school. Whichever comes later.

From Texas Child Support

Child support will terminate at the 18th birthday of the child if the child is not enrolled in high-school. If the child is enrolled, then it will terminate upon graduation of the child.
 

cutmon80

Junior Member
THNX SO MUCH CJANE!

Tell your sis that with whatever agreement/contract she goes with, for somebody to explain to her, whether the agreed/contract amount, is actually comprised of smaller "perks", OR is it the agreed/contract base amount PLUS the smaller "perks".

The contract is one year at a time.

Is there any direction you or somebody else can point me in, to figure out my anticipated obligation, some online calculator, at making $160K/yr? Thank you in advance!
 

mistoffolees

Senior Member
THNX SO MUCH CJANE!

Tell your sis that with whatever agreement/contract she goes with, for somebody to explain to her, whether the agreed/contract amount, is actually comprised of smaller "perks", OR is it the agreed/contract base amount PLUS the smaller "perks".

The contract is one year at a time.

Is there any direction you or somebody else can point me in, to figure out my anticipated obligation, some online calculator, at making $160K/yr? Thank you in advance!
Google "child support calculator texas" (without the quotes).

As one example:
Texas Child Support Calculator

Note that the larger issues will be what is considered salary and what isn't. You will probably have to google that - or ask a local attorney by taking in your contract so they can see the exact wording.
 

CJane

Senior Member
Google "child support calculator texas" (without the quotes).

As one example:
Texas Child Support Calculator

Note that the larger issues will be what is considered salary and what isn't. You will probably have to google that - or ask a local attorney by taking in your contract so they can see the exact wording.
Texas has a "cap" on the earnings that are allowed to be used towards a child support obligation. This cap is $6000 NET/month.

So, only $72,000/year NET will count as "income" for child support purposes.

This is why I was asking about the "perks" vs the salary.

As a for example, my sister's contract is written so that she makes a salary of $48K/year at her new job. In addition to her salary, she will receive $45K/year in "Living Allowances" (similar to BAH in the military). In addition to THAT, she will receive $12K/year in ... some other allowance I can't remember the name of.

Only the $48K is taxable income. But MOST of it is considered "income" available to her child for support.

OP will NOT owe child support on all $160K of "income". UNLESS the children covered under the obligation have "extraordinary needs".

However, TX only allows very specific deductions to reach the amount of "net" income. Those are:

Net income is calculated by subtracting only 5 items from the parent's gross income (gross income includes commissions, overtime pay, tips, bonuses, interest, dividends, rental income, royalty income, trust income, retirement income, disability income, etc.):

1. social security taxes,
2. federal income tax (based on the tax rate for a single person claiming one exemption),
3. state income tax (for individuals who reside in states that collect state income tax),
4. union dues, and
5. health insurance premiums for the child(ren).

...

a parent who only has an obligation to support one child will pay 20% of net earnings. A father who has an obligation to support two children with the same mother will pay 25% of net earnings.

...

There is a cap on child support of $6000 of net earnings. In other words, if the paying parent earns more than $6000 per month (net), the percentage applied will only apply to the first $6000. The only exception to this is if the court finds that the child or children have additional or exceptional "needs" that require additional support.
The obligation to two children @ $6000/month in income is about $1500.
 

LdiJ

Senior Member
That's really excellent for you. $90K tax-free is really a lot more like... $150K if it were taxed? And then you'll be paying taxes on $70K? Sounds to me like your "salary" is $70K and the remaining $90K or so is the additional non-salary pay. Right?

Just so you know, what the IRS considers income, and what the child support guidelines consider income have nothing to do with each other.
The IRS still considers that money as "income". It still appears on the tax return as wages. Its simply that the IRS gives a foreign income exclusion (in other words, you get to deduct it) for the first 90k (and its not 90k, its a few thousand lower than that).

The bad news is that the remaining 70k will not be taxed as if it was just 70k of income. It will be taxed at the marginal tax rate that would have applied if the whole 160k was being taxed.
 

garrula lingua

Senior Member
CJane;2613461[B said:
]Texas has a "cap" on the earnings that are allowed to be used towards a child support obligation. This cap is $6000 NET/month. [/B]


OP will NOT owe child support on all $160K of "income". UNLESS the children covered under the obligation have "extraordinary needs".

However, TX only allows very specific deductions to reach the amount of "net" income. Those are:



The obligation to two children @ $6000/month in income is about $1500.
If you have an order based on Texas law:
The cap is now $7,500. net income (after FICA and Federal Tax; you have to remind Tx if you are paying state income tax, to give you credit for that).
For you, the minimum amt you would be paying is $1,688., but the CP only has to prove the children's need is greater than that, and the Judge will allocate the amt over the 'cap' to either parent, as the Judge deems fit.

There is criteria to meet in order to get more than the 'cap' ordered, but it's an easy burden to meet (among the expenses: savings for college expenses, extra-curricula activities, tutoring, etc).
If you salary decreases, it's usually better to hire a Tx attorney and file for a modification immediately (or just before it decreases). The OAG is VERY slow in filing modifications right now, and they do not give retro modifications (only effective upon date of service or date of appearance in court, by statute, but most courts just do prospective modifications).

If your salary goes down, you may be better hiring an attorney in Tx to file
 

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