Court Opinion

ID: 9776351
Source: CourtListenerOpinion
Date Created: 2023-08-29 19:31:22.016275+00
Date Added: 2024-06-11T07:32:37.712531
License: Public Domain

Judith Rogers, Judge, concurring. I concur because I believe that the law of the case is determinative of our decision. I do agree that depreciation is a factor to be considered in computing income for child-support purposes. I write separately to note my concerns about depreciation being manipulated by the noncustodial parent, and to emphasize that there are many problems involved in employing reasonable and appropriate depreciation. The reduction of income by depreciation is often inappropriate when considering child support, as this reduces the amount paid for child support without regard to cash income available to the payor from rental or income-producing property. Essentially, it is an issue of the appropriate income to be used in determining the obligation of child support. The Arkansas statute tracks the Internal Revenue Code for purposes of taxable income. However, in real estate transactions a person can have no investment in the property and can receive significant cash flow, which is usually the determining factor from a financial viewpoint in the property value and income. In the instant case, it would not be proper to deduct the total amount of depreciation from appellee’s income because the depreciation relates to a long-term reserve for replacement that may take thirty years, which is well beyond the minority of the child. Some consideration should be given for reasonable depreciation to the extent that it reflects mortgage amortization or financing under the circumstances. In addition, it should be noted that appellee does not have any cash investment of his own in the real estate and therefore, even though for tax purposes he is entitled to a deduction for depreciation, he has no real out-of-pocket expenses in that regard. Therefore, there are funds available to appellee that should be utilized in the calculation of his child-support obligation. I also want to reiterate that the support guidelines are just that — guidelines — and that flexibility is delegated to the trial judge who, in utilizing his or her considerable discretion in these cases, can and should consider the economic impact and funds actually available to the payor.