                      United States Court of Appeals
                           FOR THE EIGHTH CIRCUIT
                                   ___________

                                   No. 04-1241
                                   ___________

Robert J. Desselle,                     *
                                        *
             Appellant,                 *
                                        * Appeal from the United States
      v.                                * District Court for the Western
                                        * District of Missouri.
Jo Anne B. Barnhart, Commissioner       *
of Social Security Administration,      *
                                        *
             Appellee.                  *
                                   ___________

                             Submitted: January 14, 2005
                                Filed: July 20, 2005
                                 ___________

Before LOKEN, Chief Judge, and HANSEN and MORRIS SHEPPARD ARNOLD,
      Circuit Judges.
                               ___________

MORRIS SHEPPARD ARNOLD, Circuit Judge.

        Robert Desselle appeals the affirmance by the district court1 of a final
administrative decision that denied Mr. Desselle disability insurance benefits under
Title II of the Social Security Act, see 42 U.S.C. §§ 401-434. Mr. Desselle challenges
the determination of the administrative law judge (ALJ) that he was not insured for
disability. We affirm.

      1
      The Honorable Fernando J. Gaitan, Jr., United States District Judge for the
Western District of Missouri.
       The Social Security Act divides each year into four three-month quarters, see
42 U.S.C. § 413(a)(1), and to be insured for disability and thereby qualify for
disability insurance benefits, Mr. Desselle must have had at least "20 quarters of
coverage during the 40-quarter period" that ended with the quarter in which he
became disabled or any later quarter in which he was disabled, 42 U.S.C.
§ 423(c)(1)(B)(i); 20 C.F.R. § 404.130(b)(2). For a self-employed claimant such as
Mr. Desselle, the Social Security Act defines a quarter of coverage as a quarter in
which the claimant's net income exceeds a statutory minimum, which varies by year.
42 U.S.C. §§ 411(b), 413(d)(2). But for years after 1977, the Social Security
Administration determines quarters of coverage by examining net income for the
entire year, rather than for a particular quarter. 20 C.F.R. § 404.143. Consequently,
to have four quarters of coverage during a particular year, Mr. Desselle need not have
worked during each quarter, as long as his net income for the year was at least four
times that year's statutory minimum for one quarter of coverage.

       The ALJ found that Mr. Desselle was four quarters shy of the twenty quarters
of coverage needed to qualify for disability insurance benefits and that he had no
quarters of coverage in 1993, a year that fell within the forty-quarter period during
which Mr. Desselle was required to have twenty quarters of coverage. Mr. Desselle
contends that, in the proceeding before the ALJ, he offered conclusive evidence that
he earned enough income in 1993 to have four quarters of coverage in that year. The
evidence that Mr. Desselle presented to the ALJ included one tax return for 1993; two
amended tax returns for 1993; a completed Schedule C (a form used to report the
profit or loss of a sole proprietorship) and a completed Schedule SE (a form used to
compute self-employment tax) for 1993; a copy of a check made out to the Internal
Revenue Service to pay for Mr. Desselle's 1993 tax; and a notice of deficiency from
the IRS for overdue 1993 self-employment tax.

     Mr. Desselle's initial tax return for 1993 is dated March 29, 1995, which is after
Mr. Desselle filed his application for disability in January, 1995. The initial tax

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return shows $5200 in total income, which was classified as "other income" and
described as "Handyman Income from odd jobs," and no taxes owed. Mr. Desselle's
first amended tax return for 1993, dated April 15, 1996, also shows $5200 in total
income but added $2360 in income tax owed, the calculation of which was not
explained. The second and final amended return for 1993, which is dated April 15,
1997, reclassified the income tax of $2360 owed for 1993 as self-employment tax.
Attached to the second amended return is a Schedule SE that shows $33,405 in self-
employment income for 1993, resulting in $4720 in self-employment tax and one-half
of that amount ($2360) as an income tax deduction, see 26 U.S.C. § 164(f). The
second amended return itself does not mention $33,405 and, as we have said, shows
$2360, not $4720, as self-employment tax. The Schedule C that Mr. Desselle offered
as evidence is undated and shows $3432 in net income from his business in 1993, a
figure that does not correspond to either the Schedule SE or any of the tax returns.
Mr. Desselle in 1996 paid the IRS $2360 toward his 1993 taxes, but the IRS treated
those funds as an overpayment and applied them toward overdue taxes from 1984 and
1985. After Mr. Desselle filed his second amended return, however, the IRS sent Mr.
Desselle a notice of deficiency, dated June 16, 1997, for $4720 in self-employment
tax plus interest and penalties.

       Whether these tax returns are conclusive evidence of Mr. Desselle's self-
employment income for 1993 is a question that the Social Security Act answers.
Because Mr. Desselle's second amended 1993 tax return was filed within the time
limitation set forth in 42 U.S.C. § 405(c)(1)(B), because that time limitation expired,
and because the Social Security Commissioner's records of Mr. Desselle's self-
employment income contain no entry for 1993, the Act requires the Commissioner to
"include in the Commissioner's records the self-employment income" reported in
Mr. Desselle's second amended return. 42 U.S.C. § 405(c)(4)(C); Jabbar v. Secretary
of Health & Human Servs., 855 F.2d 295, 297-98 (6th Cir. 1988) (per curiam);
Hollman v. Department of Health & Human Services, 696 F.2d 13, 16-17 (2d Cir.
1982). But see Matta v. Secretary of Health & Human Servs., 806 F.2d 287, 290 (1st

                                         -3-
Cir. 1986) (per curiam). But since Mr. Desselle applied for disability insurance
benefits within the time limitation defined in § 405(c)(1)(B), the Social Security Act
also permits the Commissioner "to change or delete any entry with respect to ... self-
employment income in the Commissioner's records." 42 U.S.C. § 405(c)(5)(A).
According to the regulation that implements this statutory provision, the Social
Security Administration "will correct SSA records to agree with a tax return of ... self-
employment income" that was "filed before the end of the time limit" in
§ 405(c)(1)(B) "to the extent that the amount of earnings shown in the return is
correct," 20 C.F.R. § 404.822(b)(2)(i), provided that "satisfactory evidence shows
SSA records are incorrect," id. at § 404.822(a). Although this regulation does not
mirror the statutory scheme of first crediting self-employment income reported in a
timely-filed tax return and then changing that entry when one of the circumstances
listed in 42 U.S.C. § 405(c)(5) applies, the statute affords the Commissioner broad
discretion to alter records of self-employment income in this case, see 42 U.S.C. §
405(c)(5)(A), and therefore we believe that the difference between the statute and the
regulation does not have a practical effect in this instance.

      In deciding not to credit Mr. Desselle with four quarters of coverage for 1993,
the ALJ found that Mr. Desselle "did not produce satisfactory evidence to warrant
amending his earnings record for 1993." See 20 C.F.R. § 404.822(a). Because the
ALJ applied the correct regulation, we must affirm if substantial evidence on the
record as a whole supports the ALJ's decision. See Young v. Apfel, 221 F.3d 1065,
1068 (8th Cir. 2000). We already have rehearsed the inconsistencies in the tax
returns that Mr. Desselle filed, all of which postdated his application for disability
insurance benefits. Additionally, at the hearing before the ALJ, Mr. Desselle's
brother and counsel, Kent Desselle, testified that Mr. Desselle "had no input into" the
preparation of the second amended 1993 return. Instead, according to Kent, Mr.
Desselle's family attempted to reconstruct his income from checks drawn in 1993 on
the checking account of Mr. Desselle's corporation, which he treated as a sole
proprietorship. Those checks, however, do not sum to any of the numbers reported

                                          -4-
as income on Mr. Desselle's 1993 tax returns and, more importantly, do not show
when the money in the checking account was earned. Nor do the other business
records from 1993, which include estimates of the costs and profits of a construction
project, show whether Mr. Desselle earned a profit that year. Finally, Kent admitted
that even he could not "make heads or tails out of the [second amended 1993] tax
return" and that he "had no high confidence level that the [second amended 1993] tax
return was accurate." Indeed, when the ALJ asked him whether Mr. Desselle "may
have had a complete loss during [1993] but you can't say one way or another," Kent
answered, "That's right."

      The record manifestly contains substantial evidence in support of the ALJ's
finding that Mr. Desselle had no quarters of coverage in 1993. We therefore affirm
the denial of disability insurance benefits to Mr. Desselle.
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