Texas Child Support Collections and Fees
Under the laws of wage garnishment in Texas, all income, including lump-sum payments that are made to the noncustodial parent, is subject to Texas child support garnishment. An employer is bound by law to enforce child support garnishment against an employee with a support order, and upon failure to enforce the order may face heavy fines and civil suits. An employer may collect up to a certain amount of administrative fees for costs associated with wage garnishment, but the allowable amount differs depending on whether the support order is for child support or for spousal support only. The employer should be aware that upon termination or retirement of the employee subject to a support order, the employer is responsible for contacting the Texas Child Support Division and/or the issuing agency.
Income Subject to Withholding for Child Support Garnishment
Any source of income in Texas is subject to support garnishment. Texas defines income as a periodic or lump-sum payment to or due an individual, regardless of source. This includes, but is not limited to, wages, salary, earnings received as an independent contractor, overtime or severance pay, commission, bonuses, and interest income. Texas income also includes any pension, annuity, workers’ compensation, disability, or retirement payments. However, there are limits on withholding – any income defined as "earnings" by the Consumer Credit Protection Act (CCPA) is protected by a maximum withholding limit. The CCPA defines "earnings" as any income that is paid or payable for personal services.
Bonuses and Other Lump Sum Payments
When an employer or administrator of another type of income owes a lump-sum payment to an employee subject to a writ of withholding, there are additional requirements that must be followed under Texas law. When the lump-sum payment owed is $500 or more, and the employee’s support payments are in arrears, the employer or administrator must notify the issuing agency before paying out the lump-sum. This includes lump-sum payments for bonuses or vacation time. Employers can report the lump-sum payment either online, or by completing and faxing a form to the State Disbursement Office. Payment cannot be made to the employee for up to ten days from the time that the agency was notified.
When an employee receives a lump-sum severance payment at termination, this is to be treated as if it were regular pay when withholding for support. For example, if an employee was paid $1,000 a week, and the severance payment is $8,000, the severance pay counts as eight weeks normal pay, and appropriate withholdings should be made before it is paid to the employee.
For additional information on lump-sum payments, contact:
Special Collections Unit
P.O. Box 12027, MC 590
Austin, TX 78711-2027
Fax: (888) 272-5122
Termination of Employment
When an employee ceases to work for a particular employer, that employer must either send a copy of the order to the Texas Child Support Division and the contact person on the order, or enter the termination information online at the Texas Child Support Division employer website. This must be done within seven days of termination. The employer should include the company name, the date of termination, the employee’s name and last known address, and the new employer address, if known. If the employee retires and will be receiving pension payments, the employer must provide the court or the state and the support obligee with the address of the pension administrator.
In Texas, an employer may charge up to $10 per month for costs associated with complying with a writ of withholding for child support, or a writ of withholding for a combination of spousal and child support. However, if the writ of withholding is only for spousal support, the employer cannot charge more than $5 per month for administrative fees. The total of the support deduction and the administrative fee cannot exceed the Texas withholding maximum. Further, the administrative fees must be deducted from the employee’s wages, and not the support payment.
Penalty for Noncompliance
If, after being served, an employer refuses to enforce an employee’s writ of withholding, they are liable to the employee for the full unpaid amount, including the amount that the employee is required to pay for health insurance, plus interest, and any attorneys’ fees and costs associated with enforcing the order. In addition to these civil remedies, an employer that fails to either withhold or remit income for child support may be subject to a fine of $200 per occurrence.
Texas State Office of Child Support – Contact Information
Attorney General’s Office
Child Support Division
P.O. Box 12017
Austin, TX 78711-2017
Phone: (512) 460-6000; (800) 252-8014
Fax: (512) 339-9051