The Percentage of Income Method for Child Support Calculation in Texas

When calculating child support in Texas, the most common approach is the “percentage of income method.” This straightforward formula provides consistency and predictability, making it easier for parents to understand their financial obligations. Whether you’re going through an uncontested divorce or trying to understand what to expect from a child support order, knowing how this method works is essential.

What Is the Percentage of Income Method?

The percentage of income method is Texas’s statutory guideline for calculating child support. Rather than considering both parents’ incomes or the actual costs of raising a child, this method applies a fixed percentage to the non-custodial parent’s net monthly resources based on the number of children being supported.

This approach is codified in the Texas Family Code and creates a rebuttable presumption—meaning courts assume the calculated amount is correct unless there’s a compelling reason to deviate from the guidelines.

The Basic Percentages

Texas law establishes clear percentages based on the number of children:

– 1 child: 20% of net monthly resources

– 2 children: 25% of net monthly resources

– 3 children: 30% of net monthly resources

– 4 children: 35% of net monthly resources

– 5 children: 40% of net monthly resources

– 6+ children: Not less than 40% of net monthly resources

These percentages apply to the obligor’s (paying parent’s) net monthly resources, not gross income.

Understanding “Net Monthly Resources”

The foundation of the calculation is determining net monthly resources, which includes:

Income Sources That Count

Wages and salary
Overtime and bonuses
Commissions
Tips and gratuities
Self-employment income
Rental income
Interest and dividends
Royalties
Retirement and pension benefits
Disability benefits (except SSI)
Unemployment benefits
Workers’ compensation
Net capital gains
Gifts and prizes
Spousal maintenance (alimony)

Deductions From Gross Income

To arrive at “net” resources, subtract:

Social Security taxes
Federal income tax (based on appropriate filing status and exemptions)
State income tax (if applicable)
Union dues
Cost of health insurance for the child

What Doesn’t Count

Return of principal or capital
Accounts receivable (for self-employed)
Benefits paid in accordance with certain federal assistance programs
Payments for foster care

The Cap on Resources

Texas law sets a cap on the income used for child support calculations. As of recent years, the cap is $9,200 per month in net monthly resources (this amount is adjusted periodically for inflation).

What This Means

If your net monthly resources are $9,200 or less, the full amount is used in the calculation
If your net monthly resources exceed $9,200, only the first $9,200 is subject to the percentage guidelines
Courts have discretion to order additional support above the cap based on the child’s proven needs

Example: If you have one child and net monthly resources of $15,000, child support would be calculated as: $9,200 × 20% = $1,840/month (not $15,000 × 20% = $3,000)

However, the custodial parent can present evidence that the child has needs exceeding what the capped amount provides, and the court may order additional support.

Step-by-Step Calculation Example

Let’s walk through a complete example:

Scenario: John owes child support for two children. His gross monthly income is $6,000.

Step 1: Calculate gross income

Monthly salary: $6,000

Step 2: Calculate deductions

Social Security/Medicare (7.65%): $459
Federal income tax (estimated): $650
Health insurance for children: $300

– Total deductions: $1,409

Step 3: Calculate net monthly resources

– $6,000 – $1,409 = $4,591 net monthly resources

Step 4: Apply the percentage

Two children = 25%

– $4,591 × 0.25 = $1,147.75/month

Step 5: Round to whole dollars

– Final child support: $1,148/month

Multiple Families Scenario

The calculation becomes more complex when the obligor has children with more than one person:

The Formula

When supporting children from multiple relationships, Texas uses this approach:

1. Calculate what support would be for ALL children combined using the total percentage

2. Divide proportionally based on how many children are in each family

Example: Michael has three children total—two with his ex-wife Sarah and one with his ex-girlfriend Lisa. His net monthly resources are $5,000.

Three children = 30% of net resources
$5,000 × 0.30 = $1,500 total child support obligation

– Sarah’s portion: (2 children ÷ 3 total) × $1,500 = $1,000

– Lisa’s portion: (1 child ÷ 3 total) × $1,500 = $500

When Courts May Deviate

While the percentage of income method creates a presumption of correctness, courts can deviate from the guidelines if:

The Child Has Special Needs

Medical, educational, or psychological needs that exceed typical costs.

The Obligor’s Income Is Very High

When resources exceed the cap, courts may find the guideline amount is more than necessary or less than the child’s demonstrated needs.

The Child Has Extraordinary Costs

Private school tuition, travel for visitation, or other unusual expenses.

The Obligor Has Other Significant Obligations

Caring for a disabled family member or other extraordinary financial responsibilities.

Custody Arrangements Are Unusual

If possession is close to 50/50, courts may adjust support accordingly.

Either Parent’s Income Is Significantly Lower Than Expected

If a parent is voluntarily underemployed or unemployed without good cause.

Other Relevant Factors

Courts can consider any factor relevant to the best interest of the child.

When deviating, courts must make specific findings about why the guideline amount is unjust or inappropriate under the circumstances.

Self-Employment and Variable Income

For parents with irregular income:

Self-Employment

Use net income (gross revenues minus ordinary and necessary business expenses)
Courts may average income over multiple years
Cannot deduct personal expenses or depreciation for luxury items

Variable Income (Commission, Bonuses)

Average the last 12-24 months
May use a shorter period if current income is significantly different
Document all income sources thoroughly

Seasonal Work

Calculate annual income and divide by 12
May require quarterly or annual recalculations

Unemployment or Underemployment

If the obligor is unemployed or underemployed:

Involuntary Unemployment

May temporarily reduce support or base it on unemployment benefits
Obligation to actively seek employment
May attribute income based on earning capacity

Voluntary Unemployment/Underemployment

Courts can “impute” income based on:
Previous earning history
Education and training
Available job market
Physical and mental capabilities

Example: A doctor who quits to work minimum wage at a coffee shop may still have child support calculated based on a doctor’s typical salary.

Benefits of the Percentage Method

Simplicity

Easy to calculate and understand—no complex formulas or extensive documentation of children’s actual expenses.

Predictability

Both parents know what to expect, reducing conflict and litigation.

Consistency

Similar situations result in similar support amounts across cases.

Flexibility

Can adjust automatically as income changes through modification proceedings.

Fairness

Tied to the parent’s ability to pay rather than arbitrary amounts.

Limitations and Criticisms

Doesn’t Consider Custodial Parent’s Income

A wealthy custodial parent receives the same support percentage as one with no income.

Doesn’t Account for Actual Costs

The amount isn’t based on what it actually costs to raise the specific children.

May Be Inadequate or Excessive

For very low or very high incomes, the percentage may not reflect actual needs.

Rigid Formula

Less flexibility than income shares models used in other states.

How This Affects Your Divorce

For Uncontested Divorces

If you agree on child support, you can:

Use the guideline percentage (courts readily approve this)
Agree to more than the guidelines (courts will typically approve)
Agree to less than the guidelines (courts scrutinize carefully and may reject)

For Contested Cases

The guidelines serve as the starting point. Either party can present evidence for deviation, but must overcome the presumption that the percentage is correct.

Modifying Child Support

When circumstances change, you can modify child support if:

It’s been three years since the last order OR
Either parent’s income has changed by 20% or more OR
There’s a material and substantial change in circumstances

The modification will use the same percentage method with updated income information.

Comparing to Other States

Many states use an “income shares” model that:

Considers both parents’ incomes
Estimates the actual cost of raising children
Prorates the obligation between parents

Texas’s percentage method is simpler but less nuanced. It’s one of several “flat percentage” states including Illinois, Wisconsin, and Mississippi.

Practical Tips

For Obligors (Paying Parents)

Keep detailed records of all income
Understand what counts as “resources”
Report income changes promptly
Don’t hide income—penalties are severe
Consider the cap if your income is high

For Obligees (Receiving Parents)

Document the other parent’s income
Understand the calculation to verify correctness
Keep records of child-related expenses
Know when modification is possible
Understand the cap limitations

For Both Parents

The percentage method is just a starting point for negotiations
Courts can approve agreements above the guidelines
Focus on the children’s actual needs
Be prepared to document special circumstances
Consider tax implications (though child support isn’t taxable)

Common Questions

Q: Can we agree to zero child support?

Courts rarely approve this unless the custodial parent has significantly higher income and both parents have substantial possession time.

Q: Does overnight possession time affect the percentage?

Not directly under the guidelines, but if possession approaches 50/50, courts may deviate from the standard percentages.

Q: What if my spouse hides income?

Courts can impute income based on earning capacity and may sanction the parent for failing to disclose.

Q: Can child support go up without my agreement?

Yes, through modification proceedings if circumstances warrant.

Q: Are bonuses and commissions really counted?

Yes, all forms of compensation are included in net monthly resources.

The Bottom Line

The percentage of income method provides a clear, predictable framework for calculating child support in Texas. By applying fixed percentages to the paying parent’s net monthly resources, it eliminates much of the guesswork and conflict around support amounts.

Whether you’re negotiating an uncontested divorce in Houston, going through court proceedings in Dallas, seeking a modification in Austin, or establishing support in San Antonio, understanding this method helps you plan financially and advocate effectively for your children’s needs. From Corpus Christi to El Paso, Texas parents can expect this same straightforward approach to child support calculations.

While the formula is simple, the details matter—from correctly calculating net resources to understanding when deviations are appropriate. If you’re uncertain about how the percentage method applies to your situation, consider consulting with a family law attorney who can review your specific circumstances and ensure the calculation is accurate and fair.

This blog post is for informational purposes only and does not constitute legal advice. Child support laws and calculations are specific to Texas. For guidance on your situation, consult with a qualified family law attorney in your jurisdiction.