may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (1996).
STATE OF MINNESOTA
IN COURT OF APPEALS
In Re the Matter of:
Bradley Jerome Rudnik,
Cheryl Lynn Helm,
Filed March 18, 1997
Affirmed in part, reversed in part, and remanded
Toussaint, Chief Judge
Ramsey County District Court
File No. 79450707
Deborah N. Dewalt, 300 Sexton Building, 529 South Seventh Street, Minneapolis, MN 55415 (for appellant)
Dyan L. Campbell, 905 Jefferson Avenue, Suite 201, St. Paul, MN 55102 (for respondent)
Considered and decided by Harten, Presiding Judge, Toussaint, Chief Judge, and Crippen, Judge.
Bradley Jerome Rudnik appeals from a child support order, contending the trial court erred by (1) not allowing him full credit for legitimate business expenses, (2) calculating respondent's support obligation based on her income after the birth of a subsequent child, and (3) failing to require respondent to contribute to the cost of a visitation expeditor. Because the trial court did not abuse its discretion by ordering appellant to meet the full costs of a visitation expeditor, we affirm in part. The trial court erred, however, in finding that a claimed $23,000 business expense lacked supporting documents and by factoring the needs of a subsequent child into a guidelines child support calculation. We reverse in part and remand for findings and recalculation of appellant's and respondent's net incomes.
Ordinarily, the trial court calculates child support according to statutory child support guidelines. Minn. Stat. § 518.551 (1996). The court derives a specific dollar amount by multiplying the obligor's net income by the appropriate percentage. Minn. Stat. § 518.551, subd. 5(b).
The trial court disallowed a $23,000 Internal Revenue Service (IRS) Schedule E deduction and accordingly increased appellant's 1995 net income by $23,000, finding (1) the record lacked supporting documentation and (2) the Schedule E deduction illogically duplicated deductions already reflected on Schedule C. The trial court did not find that any other documentation provided by appellant was questionable or unreliable. Appellant contends the trial court abused its discretion because its findings are not supported by the record. We agree, and conclude that the record contains sufficient documentation to support the $23,000 Schedule E deduction, including, (1) appellant's affidavit explaining disposition of $40,000 in lawsuit proceeds, (2) a letter from the IRS dated January 2, 1996, documenting a schedule of agreed payments totaling $40,000 in 1995, (3) a February 22, 1995, letter to appellant's attorneys from the Minnesota Department of Economic Security setting forth a payment schedule for 1995 corresponding to the schedule attached to the IRS letter of January 2, 1996, (4) a February 28, 1995, letter to appellant's attorneys from the IRS indicating a payment schedule corresponding to the schedule attached to the IRS letter of January 2, 1996, (5) an affidavit of appellant's attorneys stating that the proceeds of the lawsuit must be paid in accordance with IRS schedule attached to the IRS letter of January 2, 1996, and (6) appellant's 1994 tax returns documenting Schedule C and Schedule E losses consistent with the schedule of payments attached to the letter from the IRS dated January 2, 1996.
The trial court's finding that appellant's $23,000 Schedule E deduction duplicates deductions already reflected on Schedule C is likewise not supported in the record. The Schedule C deductions do not account for appellant's business expenses related to lawsuit proceeds.
Appellant, as a self-employed person, is entitled to full credit for his business expenses. See Bartl v. Bartl, 497 N.W.2d 295, 300 (Minn. App. 1993) (concluding that the trial court abused its discretion by not giving appellant credit for his expenses incurred solely for the production of income). Appellant claims the $40,000 in lawsuit proceeds was spent to cover legitimate business expenses. Documentation provided by appellant supports his contention that in 1995 he paid $17,000 in attorney fees and $23,000 to various government agencies as back taxes related to a business obligation. The trial court must give appellant full credit for any reasonable business expenses and calculate his net income accordingly. We reverse and remand for findings and recalculation of appellant's net income with credit for all reasonable business expenses.
Appellant contends the trial court abused its discretion by basing respondent's child support obligation on her income following the birth of a subsequent child. We agree. The trial court ignored the undisputed fact that respondent reduced her employment hours based on the needs of a subsequent child. Further, the trial court abused its discretion by factoring the needs of a subsequent child into a guidelines calculation.
In determining a child support award, the trial court may appropriately consider the obligor's burden to support subsequent children. Bock v. Bock, 506 N.W.2d 321, 324 (Minn. App. 1993). The needs of subsequent children may not, however, be factored into a guidelines calculation. Id. The trial court may deviate from the guidelines to consider the needs of subsequent children, but subsequent children should not generally be favored over earlier children. Id. at 325. The deviation process must involve comparing contributions to all children of the obligor. Id. Required findings includes determining
the obligor's total ability to contribute to dependent children, taking into account the obligor's income and reasonable expenses exclusive of childcare.
Id. In these deviation determinations, the obligor's reasonable expenses must be reduced as appropriate to take into account contributions to those costs by the another parent of the subsequent children. Id.
Respondent earned $1252.28 per month for full-time work until April 1996. She then took a maternity leave to care for a new baby, including nursing, and expected to resume work on a part-time basis in June of 1996, earning $811.11 per month. The trial court erroneously found that respondent had earned $811.11 since mid-1995. A statutory guidelines calculation should have been based on her full-time 1996 income prior to the birth of her subsequent child. If the trial court, in its discretion, meant to consider the ability of respondent to contribute to her dependent children following childbirth or the needs of respondent's subsequent child, the trial court erred in failing to make appropriate findings to support the deviation. We remand for findings and recalculation of respondent's support obligation.
The trial court has extensive discretion in deciding visitation questions and will not be reversed absent an abuse of discretion. Manthei v. Manthei, 268 N.W.2d 45, 45 (Minn. 1978). A trial court's findings may not be set aside unless they are clearly erroneous. Griffin v. Van Griffin, 267 N.W.2d 733, 735 (Minn. 1978). In light of the trial court's finding, supported in the record, that respondent is without funds to meet the costs of a visitation expeditor, we cannot conclude the trial court abused its discretion by ordering appellant to be responsible for all charges.
Affirmed in part, reversed in part, and remanded.