This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (2002).






In re Joe B. Beier, petitioner,





Marcia Fay Beier,



Filed September 30, 2003

Affirmed in part, reversed in part, and remanded

Willis, Judge


Stearns County District Court

File No. F8002149


John E. Mack, Mack & Daby, P.A., 26 Main Street, P.O. Box 302, New London, MN 56273 (for appellant)


Marcia Fay Beier, 22084 383rd Avenue, Belgrade, MN  56312 (pro se respondent)


Janelle P. Kendall, Stearns County Attorney, 705 Courthouse Square, St. Cloud, MN  56303 (for respondent county)


            Considered and decided by Willis, Presiding Judge; Shumaker, Judge; and Stoneburner, Judge.

U N P U B L I S H E D   O P I N I O N


            On appeal from an order of a child support magistrate (CSM), appellant argues that (a) the CSM abused his discretion by calculating appellant’s income for child-support purposes by disallowing the accelerated-depreciation expenses claimed by the corporation employing appellant and in which appellant had a one-half interest; (b) the CSM’s rejection of other business expenses claimed by appellant is not supported by the record; and (c) the CSM abused his discretion by imputing income to appellant without considering the taxes due on the imputed income.  We affirm in part, reverse in part, and remand. 


            The December 28, 2001 judgment dissolving the marriage of appellant-father Joe Beier and respondent-mother Marcia Beier awarded mother physical custody of the parties’ two minor children and reserved father’s child-support obligation.  The county later intervened in the proceeding and, in the expedited child-support hearing process authorized by Minn. Stat. § 484.702 (2002), sought to establish a support obligation for father.  On January 21, 2003, a CSM found father’s average net monthly income to be $4,747 and set his monthly support obligation at $1,424, the guidelines amount for father’s net monthly income.

            Father is an employee of a corporation in which he owns a one-half interest.  In calculating father’s net monthly income, the CSM added to father’s annual salary $11,333, representing father’s share of income that the CSM determined was earned by the corporation but not reported, and $6,348 to account for father’s personal expenses paid by the corporation.  The CSM added an additional $5,964, representing one-half of the accelerated-depreciation deduction claimed by the corporation.  Father challenges here the CSM’s support determination but does so without having sought review of that determination under Minn. R. Gen. Pract. 376.  And father has not provided this court with a transcript of the hearing before the CSM.


Father challenges the determination of his net monthly income for child-support purposes.  Generally, a finding of net income for child-support purposes is affirmed on appeal if it has a reasonable basis in fact and is not clearly erroneous.  State ex rel. Rimolde v. Tinker, 601 N.W.2d 468, 470 (Minn. App. 1999).  Here, however, father did not seek review of the CSM’s ruling pursuant to Minn. R. Gen. Pract. 376.  Nor did he provide this court with a transcript of the hearing before the CSM.  Father’s failure to seek review of the CSM’s ruling under Minn. R. Gen. Pract. 376 limits the scope of our review to determining whether the evidence supports the findings of fact and whether the findings of fact support the conclusions of law and judgment.  Davis v. Davis, 631 N.W.2d 822, 825 (Minn. App. 2001); Minn. R. Gen. Pract. 378.01 advisory comm. cmt.  And father’s failure to provide a transcript on appeal further limits our scope of review by precluding us from addressing whether the evidence supports the findings of fact.  Mesenbourg v. Mesenbourg, 538 N.W.2d 489, 494 (Minn. App. 1995).  Thus, the scope of our review here is limited to determining whether the conclusions of law and the judgment are supported by the findings of fact and whether the findings are defective for some reason other than being unsupported by the evidence.  Cf. Preussner v. Timmer, 414 N.W.2d 577, 579 (Minn. App. 1987) (stating findings of fact are clearly erroneous if they are induced by an erroneous view of the law). 


Father argues that the CSM added to his salary one-half of the accelerated depreciation claimed by the corporation because the CSM misread Minn. Stat. § 518.551, subd. 5b(f) (2002), to preclude the use of accelerated depreciation in calculating income for child-support purposes.  Father maintains that a correct reading of the statute precludes use of an accelerated-depreciation deduction in calculating income for child-support purposes only if the accelerated depreciation is determined “to be inappropriate for determining income for purposes of child support.”  Because father argues that the finding of his income is based on an erroneous view of the law, the argument is within our limited scope of review. 

Under the relevant statute,

[i]ncome from self employment is equal to gross receipts minus ordinary and necessary expenses.  Ordinary and necessary expenses do not include amounts allowed by the Internal Revenue Service for accelerated depreciation expenses or investment tax credits or any other business expenses determined by the court to be inappropriate for determining income for purposes of child support.  The person seeking to deduct an expense, including depreciation, has the burden of proving, if challenged, that the expense is ordinary and necessary.  Net income under this section may be different from taxable income.


Minn. Stat. § 518.551, subd. 5b(f) (emphasis added).  Father cites no authority for the proposition that a person employed by a corporation in which he owns a one-half interest is self-employed for purposes of Minn. Stat. § 518.551, subd. 5b(f), and is therefore entitled to a depreciation deduction under this provision.  But even if we were to conclude that father was self-employed for purposes of Minn. Stat. § 518.551, subd. 5b(f), he would not be entitled to relief. 

Depreciation deductions are allowed “when the record contains credible evidence of legitimate depreciation deductions[.]”  Preussner, 414 N.W.2d at 579.  Here, the CSM allowed father some depreciation expense but found it “appropriate” to disallow the accelerated portion of the corporation’s depreciation expense claimed on its tax return.  Thus, the record does not show that the CSM misread the statute as father suggests.  Additionally, without a transcript, we do not know what depreciation-related evidence was presented to the CSM.  The CSM found, however, that the corporation’s tax returns were unreliable because not all corporate income was reported to the corporation’s accountant, and we defer to that credibility determination.  Robert v. Zygmunt, 652 N.W.2d 537, 544 (Minn. App. 2002).  The CSM also found that father admitted in testimony that he lacked sufficient knowledge of the corporation’s finances to supply the CSM with the information that was not provided to the accountant.  On this record, the CSM’s order contains the statutory finding regarding the propriety of a depreciation deduction, and father has not shown that the district court misread the statute in making that finding or that the record contains the evidence necessary to allow him the relief he seeks.   


            Father argues that the record lacks support for various income-related findings of fact.  Without a transcript, however, we cannot review whether the record supports the findings that he questions.  Mesenbourg, 538 N.W.2d at 494.


In determining a support obligor’s net monthly income, the obligor’s total monthly income is reduced by various amounts, including federal, state, and social-security taxes.  Minn. Stat. § 518.551, subd. 5(b)(i)-(iii) (2002).  Here, in finding father’s income for support purposes, the CSM added to father’s net annual income the amount of $11,333 as father’s share of unreported corporate income and the amount of $6,348 to account for father’s personal expenses paid by the corporation.  The CSM did not reduce either figure by the taxes father would have paid on those amounts if they had been reported as part of his income for tax purposes.  The CSM explained that “[i]t is appropriate to use actual taxes as there is no evidence any additional taxes will be paid.”  Father argues that amounts imputed to him should have been reduced by the amount of the taxes he would have paid if they had been included in his income for tax purposes.  Because this argument is one that the finding of father’s income is based on “an erroneous view of the law,” it is within our limited scope of review here.

Setting support according to the child-support guidelines is rebuttably presumed to be appropriate in “all cases.”  Minn. Stat. § 518.551, subd. 5(i) (2002).  A guidelines support obligation is to be based on the obligor’s “net monthly income.”  Minn. Stat. § 518.551, subd. 5(b).  “Net monthly income” is calculated by reducing “total monthly income” by federal, state, and social-security taxes, among other things.  Minn. Stat. § 518.551, subd. 5(b)(i)-(iii).  A support obligation set at a nonguidelines amount is a deviation and must be supported by findings identifying the guidelines amount and explaining why support is set at a different amount.  Minn. Stat. § 518.551, subd. 5(i).  Thus, whether support is set at the guidelines amount or at a nonguidelines amount, net monthly income, including deductions for taxes, must be determined, or at least estimated.  Minn. Stat. § 518.551, subd. 5(b), (i); see Marx v. Marx, 409 N.W.2d 526, 529 (Minn. App. 1987) (affirming district court’s estimation of support obligor’s income by using his total income “less 25 percent for taxes and other deductions”); cf. Dinwiddie v. Dinwiddie, 379 N.W.2d 227, 229 (Minn. App. 1985) (stating generally, “[t]o arrive at net income [for support purposes], federal and state income taxes are to be deducted from total income” and that “[n]et income is properly calculated based upon monies available to the tax payer”).  Therefore, we reverse the CSM’s refusal to adjust the amounts imputed to father for the taxes payable on those amounts and remand for the appropriate adjustments of the findings of father’s income and his child-support obligation.

Affirmed in part, reversed in part, and remanded.