What type of income is reported separately from other earned income on Schedule C?

Business income is reported separately from other earned income on Schedule C because Schedule C specifically pertains to profit or loss from a business operated as a sole proprietorship. This form is used to report the income generated from business activities, expenses related to those activities, and ultimately the net profit or loss.

The distinction is important because business income includes revenue from selling goods or services in the course of ordinary business operations, while the other types of income listed, such as capital gains or investment income, are not derived from business activities and are reported on different tax forms. Rental income can also be reported separately but typically goes on Schedule E, which is designated for income or loss from rental real estate, rather than Schedule C. Thus, the focus of Schedule C is specifically on business income, making it the correct choice in this context.