Yes, for all income withholdings, the upper limit on what may be withheld is based on the Federal Consumer Credit Protection Act (CCPA). The maximum allowable amount that can be withheld from an employee/independent contractor to pay child support depends on two factors:
- Whether the employee/independent contractor has other dependents
- Whether the income deduction notice includes arrears payments (a periodic repayment for past-due child support)
The Federal CCPA limit is 50% of the disposable earnings if the employee/independent contractor supports a second family and 60% if the employee/independent contractor does not support a second family. These limit increase to 55% and 65% respectively if the employee/independent contractor owes past-due child support amounts that are 12 weeks or more past due.
States may choose a lower limit. Check with your state to determine exact limits. (About two-thirds of the states use the federal limits, and about one-third cap the withholding at 50% regardless of second families or arrearage amount.)