I cannot tell from your question whether someone is trying to establish a child support order, or whether they are attempting to collect child support arrears under an existing order. Whether a particular type of income can be used in the calculation of child support or can be seized to collect child support has nothing to do with whether the income is taxed. Under Colorado law, disability benefits are considered as "gross income" for the purpose of determining how much child support a parent should pay. I assume there is a way to seize a part of your disability benefits to collect child support, but I have never had to do those with VA disability, so I am not sure.
You may have more issues to address than the one you posted. If you owe child support arrears under a child support order that was entered when you earned more than your current disability pay, and your children are still minors, then you can probably get a court to reduce your ongoing child support obligation, but you need to file a motion to modify with the court. As a general rule, only support payments which come due after you file a motion to modify can be reduced (or increased, depending on the circumstances) by the court.
You should make an appointment to speak with a competent family law attorney, and bring with you whatever paperwork you have received in this matter, to receive more specific advice about your particular circumstances.
The test to determine if your benefits are subject to garnishment is whether the payment is remuneration (payment) for employment as defined in section 459 [42 U.S.C. 659(a) and (h)]. While Federal salaries fit this test, and Title II Social Security Old-Age, Survivors, and Disability Insurance benefits (OASDI) can be garnished (entitlement to these benefits is based on employee contributions into FICA), VA monetary benefits, entitlement to which is generally based on either the veteran's disability and wartime service (pension) or disability from service-connected injury or disease (compensation), is generally not considered remuneration (payment) for employment.
However, the Social Security Act and the statutes governing benefit payment by the Department of Veterans Affairs do provide for processes by which dependents may obtain financial support from veterans' benefits under certain circumstances. Below are two examples highlighting the laws or regulations under which benefits paid by the Department of Veterans Affairs can be paid to dependents to fulfill child support obligations.
The Department of Veterans Affairs has issued regulations pursuant to 38 U.S.C. 5307 that provide for an apportionment of VA benefits between the veteran and his/her dependents under certain circumstances. VA regulations at 38 CFR Section 3.450(a)(1)(ii) provide that, if the veteran is not residing with his or her spouse, or if the veteran's children are not residing with the veteran and the veteran is not reasonably discharging his or her responsibility for the spouse's or children's support, all or any part of the veteran's pension, compensation, or emergency officers' retirement pay may be apportioned.
Disclaimer Information on this site is provided by Brian Scott Wayson as general information, not legal advice, and use of this information does not establish an attorney-client relationship. If you have questions about your specific situation, please call an attorney.