A new Minnesota Court of Appeals decision offers an important reminder for farm families: the income shown on a tax return does not necessarily control child support.
What Happened?
In In re Custody of M.D.T., filed September 14, 2026, the district court reduced a farmer’s child-support obligation after adopting an accountant’s calculation of his income. The Minnesota Court of Appeals reversed. Although the accountant relied on the farmer’s guaranteed salary and share of farm profits or losses, the record did not establish that the calculation followed Minnesota’s statutory method for self-employment income.
Under Minnesota Statutes section 518A.30, farm or business income generally starts with gross receipts, subtracts the cost of goods sold and ordinary and necessary business expenses, excludes accelerated depreciation and other inappropriate or excessive expenses, and then allocates the result according to the parent’s ownership interest. The appellate court held that available financial data was not enough; the decision-maker needed findings showing that the statutory formula was actually applied.
Why This Matters in a Farm Divorce
Farm finances rarely fit neatly into a W-2. Cash flow, depreciation, prepaid expenses, livestock and grain inventories, equipment purchases, debt service, retained earnings, and ownership allocations can materially affect the analysis. An accountant’s tax-income figure may serve an important tax purpose while still failing to answer the family court’s legal question.
For a farmer or spouse of a farmer, this decision underscores the need to present complete source records and a transparent calculation tied to Minnesota law. Schedule F and Schedule K-1 forms may be part of the picture, but balance sheets, income statements, depreciation schedules, general ledgers, loan records, and ownership documents may also matter. Careful analysis can help prevent both inflated income assumptions and the understatement of income available for support.
Talk With a Minnesota Farm Divorce Attorney
If your divorce or child-support matter involves a farm, agribusiness, or closely held company, the way income is calculated can significantly affect the outcome. Gislason & Hunter LLP represents Minnesota clients in complex family-law matters involving farm operations and other difficult financial issues. Contact us to discuss your circumstances and develop a strategy grounded in the financial records and Minnesota law.
Andrew M. Tatge is a Partner at Gislason & Hunter and chair of the firm’s Family Law and Divorce Practice Group. He represents farmers, business owners, professionals, and other individuals in divorce and related actions. He also writes and speaks regularly on divorce issues related to business owners and family farms. Andrew can be reached at atatge@gislason.com or (507) 387-1115. This information is general in nature and should not be construed for tax or legal advice.
