The 2009 Texas Attorney General Tax Chart.

The 2009 Attorney General Tax Chart is now available for the setting of child support in Texas. It is interesting to note that the Texas Minimum Wage will change from $6.55 to $7.25 on July 24, 2009. Therefore, the minumum wage presumption used for setting child support will increase on that day.

As a result, if child support is set using the minimum wage presumption (based upon a 40 hour work week), child support would be as follows:

From January 1, 2009 to July 23, 2009:

1 Child - $202.57
2 Children - $253.22
3 Children - $303.86
4 Children - $354.51
5 Children- $405.14
6+ Children- Not Less Than $405.14

From July 24, 2009 to December 31, 2009:

1 Child - $222.56
2 Children - $278.20
3 Children - $333.84
4 Children - $389.48
5 Children - $445.12
6+ Children- Not Less Than $445.12

These amounts do not include arguments that the Obligor might have for paying a reduced amount due to actual payments of union dues and/or health care insurance for the child(ren). Also, the amounts also do not adjust for any children that outside the household upon which the order is based, for whom the Obligor may also have a duty of support. For the reduced percentages, see Texas Family Code §154.129

Spousal Maintenance, Alimony and Tax Tips for Texas Divorces

Spouses can agree to the payment of spousal maintenance (or what is basically alimony in Texas) . However, spouses in the process of a divorce would regard a Court Order requiring the payment of spousal maintenance to be an unfavorable scenario. This may not actually be the case. Because of how the IRS treats the payments for tax purposes, this may actually be favorable for both spouses. If structured properly, the paying spouse (Obligor) may be able to deduct the payment from his or her income. As a result, this liability actually removes income from the paying spouse's reported income, thereby reducing the Obligor's tax liability. The effect of this over time could be significant, especially if the payments drop the Obligor into a lower tax bracket.

On the other hand, the receiving spouse (Obligee) must report the payments as additional income on his or her Form 1040. By structuring the settlement in this manner, the Obligor could hang on to additional assets and reduce his or her tax liability at the same time. Conversely, the Obligee could obtain the security of payments over time and, assuming the Obligee is in a lower tax-bracket, reduce the overall tax liability of the marital estate.

Under IRS publication 504, the following types of payment are not considered to be spousal maintenance (alimony):

· Child support,
· Noncash property settlements,
· Payments that are your spouse's part of community income,
· Payments to keep up the payer's property, or
· Use of the payer's property.

In order to qualify to be alimony (or spousal maintenance), the settlement must be structured properly. The following seven requirements are mandatory:

1. The payments must be made as part of a written divorce agreement;
2. The payments must be made to your ex-spouse and usually not to third parties;
3. The divorce (or agreement incident to divorce) should not expressly disclaim that the payment is for alimony (spousal maintenance);
4. After the divorce, you and your spouse cannot live together in the same household and should not file the taxes jointly;
5. The payment must be in cash or equivalents (checks, money orders, cashier's checks) and not money from a property settlement;
6. The payment cannot be considered to be child support; and,
7. The obligation to make payments must cease if your ex dies.

If you have questions, you should consult an experienced divorce attorney or CPA.

***** Treasury Circular 230 Disclosure - To comply with requirements imposed by the Internal Revenue Service, to the extent this blog posting could be construed to include "tax advice," the information is not intended or written to be used, and cannot be used, by any person for the purpose of avoiding tax penalties that may be imposed on the person. This blog post is intended for informational purposes only, the taxpayer should seek advice based on the taxpayer's particular circumstances from an independent tax advisor.