What types of income are included in business and investment income?

Business and investment income refers to the earnings derived from activities related to the operation of a business or from investing. Rent falls under this category, as it is income generated from leasing property. This type of income is directly tied to the business or investment activities of an individual or entity, making it a significant component of total business income.

In contrast, wages are compensatory payments for employment and are not categorized under business or investment income because they arise from a different source. Capital gains represent profits from the sale of an investment asset and may also be considered in a broader financial context but typically are distinguished from business income. Lottery winnings, on the other hand, are considered windfall income, stemming from chance rather than investment or business activities. Thus, rent stands out as the most representative example of business and investment income in this context.